Brent crude slipped below the $90 threshold in early Friday trading, dropping about 0.3% to $89.45 a barrel, while West Texas Intermediate declined 0.3% to $83.31. Both benchmarks were on track for their first weekly decline in three weeks, with Brent down roughly 5.3% and WTI down about 4.3% for the week.
The pullback reflects a tug of war between improved diplomatic signals around the Strait of Hormuz and renewed supply risks from Russia. Iran and Oman have moved closer to a framework for managing shipping through the strategic waterway, including a temporary corridor and talks over its future administration. However, Tehran stressed that the arrangement does not amount to a full reopening, and Washington has shown little appetite for restarting direct negotiations.
Physical shipping data still show severe disruption. Only seven visible commodity vessels crossed the Strait of Hormuz on Thursday, down from 17 a day earlier and below the 10-day average of 15, according to preliminary Kpler data reported by Reuters. Roughly one-fifth of global oil supply normally moves through Hormuz, leaving the market sensitive to any concrete change in traffic.
ANZ Research analysts said fading hopes of an immediate reopening were supporting crude after the earlier selloff. They argued actual progress on restoring traffic remains more important than announcements about a potential framework.
Supply-side pressure is also building around Russia. Repeated Ukrainian attacks on refineries and export infrastructure have disrupted fuel availability. Russia has imported more than 1 million barrels of gasoline by sea since late July to ease domestic shortages, with additional supplies arriving from Belarus and Kazakhstan, according to S&P Global Commodities at Sea and Kpler. Moscow is preparing to extend diesel export restrictions through September after attacks left several refineries idle.
U.S. inventory data added another layer of support. Commercial crude stocks increased only 0.1 million barrels to 428.9 million barrels in the week ended Aug. 21, while gasoline inventories dropped 2.5 million barrels and stood 6% below the five-year seasonal average. Distillate stocks fell 2.2 million barrels and remained about 14% below normal seasonal levels.
On the supply-and-demand outlook, OPEC+ plans to return another 188,000 barrels per day of voluntary production cuts in September, with the group scheduled to meet again Sept. 6. The International Energy Agency estimates the global oil market could remain in a 1.8 million-barrel-per-day deficit during the third quarter, after observed inventories plunged by 69 million barrels in July. At the same time, the IEA expects global oil demand to fall by 1.6 million barrels per day in 2026.
For crude, the next move may depend on whether a functioning Hormuz corridor materializes or whether Russian refinery outages and tight product inventories restore the geopolitical premium. A concrete increase in tanker traffic would strengthen the bearish case, while deeper disruption could quickly put $90 Brent back in play.
