Oil: Tanker risks support prices – ING

ING analysts have observed that oil prices remain supported despite tensions between the US and Iran escalating in the Persian Gulf. They point to continuous flows through the Strait of Hormuz, assisted by US Navy escort, and unchanged OPEC+ quotas. Speculative net longs in ICE Brent have surged, while many producers are operating below quota due to disruptions.

The oil market continues to be well-supported, with no sign of peace between the US and Iran. The US recently targeted several Iranian-linked tankers following Iran's actions against unauthorized tankers. Iran claims it has retaliated against unauthorized tankers and plans to enforce a new restricted zone outside the Strait of Hormuz, which could put additional vessels at risk.

Despite the escalation, oil continues to flow, with the US energy secretary reporting an average of over 9 million barrels per day moving through the Strait of Hormuz, facilitated by US Navy escorts. OPEC+ maintained its output quotas for October unchanged, but members are likely to produce significantly below quota due to ongoing disruptions.

Speculators have increased their net long position in ICE Brent, buying 37,837 lots to reach a net long of 261,435 lots as of last Tuesday, primarily through short covering. While oil price action remains moderate, European gas prices have seen more upside, with the TTF trading almost 4% higher. However, LNG is not flowing as much as crude oil, leaving the gas market increasingly vulnerable as the 2026/27 heating season approaches.