Brent crude has held above $100 a barrel for most of the past month even though tanker-tracking data shows Middle East flows back above pre-war levels. Record freight rates, a diesel shortage and thin inventories are keeping delivered oil expensive, and analysts say prices will stay elevated until shipping risk and fuel exports normalize.
Flows recover, but Brent stays near $100
Brent crude has held above $100 a barrel for most of the past month, up from $60 before the war. Tanker-tracking services and investment banks report that crude flows from the Strait of Hormuz have recovered, and even exceeded, pre-war levels. The gap between barrels moving and the price holding comes down to what it costs to get that crude oil out safely.
Freight rates sit at record highs, and war-risk premiums have climbed as tankers keep coming under attack in the strait. Gulf producers have turned to alternative routes that are less efficient, cost buyers more, and add weeks to delivery. Ole Hansen, head of commodity strategy at Saxo Bank, said a sustained move lower in Brent requires broader normalisation: improving crude supply, recovering product exports and reduced political and financial risks to shipping.
Diesel shortage adds pressure ahead of winter
Fuel exports from the Middle East remain limited, Russia's are non-existent under Moscow's diesel shipment ban, and China is again curbing fuel flows overseas to protect domestic supply. Global inventories have also crashed this year, drawn down to cushion the initial Strait of Hormuz disruptions in April and May, leaving little buffer before winter's peak diesel demand.
The G7 announced the release of 100 million barrels of crude oil and diesel stocks on Friday, but the effect faded quickly. Bjarne Schieldrop, chief analyst commodities at SEB Bank, noted the market isn't certain how many of those barrels are genuinely new rather than leftovers from an earlier, partly unfulfilled IEA pledge to release 425 million barrels.
Upside risk stays the dominant threat
Thin inventories leave little room to absorb another shock, and the market is watching for fresh escalation around the U.S. midterm elections in November, including the possibility of renewed Houthi attacks on Saudi pipeline and shipping routes. Saudi Aramco CEO Amin Nasser said at the 2026 Energy Intelligence Forum in London, "the supply resilience cushion is scarily thin." That risk is what keeps traders pricing Brent well above where physical flows alone would suggest.
Source: Investing.com – Commodities Analysis & Opinion
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