The resumption of hostilities between the US and Iran, formally declared on 13 July 2026 means markets remain under pressure.
According to Eastspring Investments Weekly Bulletin, strikes on ships attempting to pass through the Strait of Hormuz in the wake of reopened hostilities have cut confirmed crude oil flows from about 12.5 million barrels per day (mbpd) to an estimated 5mbpd. Brent crude oil prices also rose once again to above $90/bbl.
The bulletin also noted that refined product flows from the Middle East have fallen, alongside lower Russian refinery runs.
Uncertainty ahead
Calling what happens next between the US and Iran “highly uncertain”, the bulletin also highlighted warnings from Iran that if the US struck Iranian infrastructure, it would pressure the Houthis to disrupt the Bab al Mandeb Strait leading to the Red Sea.
“This would further curtail global oil supply, constricting what has been an important route for redirection of flows,” said the bulletin.