Crude oil benchmarks extended a sharp rally in mid-August trading as renewed tensions around the Strait of Hormuz kept supply disruption risks at the center of global markets. Brent crude futures rose 26 cents to $91.28 per barrel, while U.S. West Texas Intermediate added 37 cents to $85.31 in early Wednesday trade, marking a fourth consecutive session of gains and the highest settlements since July 24.
The latest leg higher followed a breakdown in diplomatic communication between Washington and Tehran. A temporary ceasefire expired on Monday, and President Donald Trump said on Tuesday that no talks were taking place with Iran. The two sides remain at odds over shipping conditions: Washington says the Strait of Hormuz is open, while Iran maintains that shipping remains restricted. That uncertainty has left traders unsure how quickly normal crude flows can resume.
Technical levels have amplified the macro story. Brent finished around $91.08 after testing $92 during the session. Trader Taner Genek views $92 as the key near-term dividing line. According to his chart scenario, a failure to hold above that area could bring Brent back toward roughly $86.66, while a sustained move above $92 would be a hawkish signal for energy costs and could have negative implications for equity markets.
For WTI, the daily chart shows price pressing against a long-term descending resistance line while rising support narrows the trading range. The setup remains neutral until a clear breakout occurs, but the supply backdrop is not neutral. Saudi Aramco has resumed some crude loadings from inside Hormuz, Iraq has approved alternative export mechanisms beginning September 1, and some Chinese shipping companies have rerouted cargoes away from Hormuz and Bab el-Mandeb. Those adjustments offer partial relief but have not removed broader uncertainty around regional exports.
Fundamental data remains divided. The International Energy Agency said global oil supply increased by 2.4 million barrels per day in July but was still 6.3 million barrels per day below year-earlier levels. The IEA expects a 1.8 million-barrel-per-day market deficit in the third quarter, even as high fuel prices and supply disruptions weigh on demand. The next immediate catalyst is the U.S. Energy Information Administration’s weekly petroleum report, due Wednesday at 10:30 a.m. ET. Analysts surveyed by Reuters expect crude inventories to fall by about 600,000 barrels.
By Thursday’s session, WTI had surged past $84.50, trading around $84.60, up 1.8% on the day, while Brent climbed above $87. The Strait of Hormuz handles roughly 20% of global oil consumption, making it one of the most important chokepoints for crude shipments from Saudi Arabia, Iraq, the UAE, and other Gulf producers. Traders have priced in a higher geopolitical risk premium, and energy equities and oil-linked currencies have strengthened in response. Some analysts caution the rally could reverse quickly if tensions ease, given relatively comfortable global inventories.
For digital asset markets, the spike in oil is primarily an inflation and risk-sentiment story. Sustained energy-price pressure could complicate central bank policy, weigh on equity multiples, and increase volatility across risk assets, including cryptocurrencies. If the Hormuz standoff escalates further, the resulting risk-off environment may create headwinds for crypto; if it de-escalates, risk sentiment and inflation expectations could stabilize.
