NEW YORK, March 4, 2026, 13:31 (EST) — Regular session
Oil prices slipped back after an early jump on Wednesday, with Brent futures down 24 cents at $81.13 a barrel by 11:18 a.m. ET, and U.S. West Texas Intermediate losing 27 cents to $74.30—a 0.4% dip. Earlier, Brent had surged over $3 to reach $84.48, but news of possible intelligence talks between Iran and the U.S. wiped out much of the rally. UBS’s Giovanni Staunovo pointed out that traders appeared to be betting on “a de-escalation.” Still, Dennis Kissler at BOK Financial flagged that heavy volumes of oil lingering offshore could leave “price volatility” elevated. Reuters
It’s a narrow waterway, but the stakes couldn’t be bigger. The Strait of Hormuz — which carries nearly 20% of the world’s oil and liquefied natural gas — has now been locked up for five straight days, after the U.S.–Iran conflict intensified. A U.S. strike took out an Iranian warship near Sri Lanka, according to Reuters. Even as President Donald Trump promised insurance and naval escorts, BIMCO safety chief Jakob Larsen dismissed the idea of comprehensive tanker protection as “unrealistic.” Reuters
That bottleneck is already taking barrels off the market. Iraq has trimmed oil output by close to 1.5 million barrels per day (bpd), and according to officials, that cut could swell past 3 million bpd within days if crude shipments through Hormuz stay blocked and can’t get to loading ports. Specific reductions hit Rumaila, West Qurna 2, and Maysan, as storage capacity tightens at southern export terminals.
Saudi Arabia’s workaround for the Hormuz chokepoint is proving complicated. According to sources, Saudi Aramco has instructed some Arab Light crude buyers to pick up their cargo at Yanbu, a Red Sea port—though freight rates there have shot up, more than doubling. “Logistical trade-offs,” said Energy Aspects co-founder Richard Bronze, come down to Yanbu’s loading pace. Kpler data cited by Reuters put Saudi exports at around 7.2 million bpd in February, with 6.38 million bpd of that usually heading out via the strait. Reuters
After a sharp two-day surge, the market retreated on Wednesday. On Tuesday, Brent finished up $3.66, or 4.7%, at $81.40—marking the highest close since January 2025. WTI added $3.33, also up 4.7%, to reach $74.56, a peak not seen since June. Industry data from the American Petroleum Institute indicated U.S. crude inventories climbed by 5.6 million barrels last week, market sources said.
Everything now depends on whether Hormuz shipments stay suppressed or begin to recover. Goldman Sachs bumped its second-quarter Brent forecast up by $10, putting the target at $76 a barrel, and increased its WTI outlook by $9 to $71. The bank pointed to low flows as a setup for steep inventory drops in OECD countries and expected Middle East supply to fall in March. Goldman’s note argued Brent could hit $100 if Hormuz volumes don’t improve over the next five weeks. The firm also highlighted the risk that flows could normalize sooner than markets expect, which would cap prices.
UBS lifted its Brent forecast again, bumping the first-quarter average to $71 a barrel, and now sees 2026 prices at $72. The bank points to the near de facto closure of Hormuz as a key factor. According to UBS, if strikes hammer energy infrastructure in the region, Brent could jump past $90—potentially even topping $100 if the shutdown drags on. On the other hand, some of that risk premium—what traders tack on for supply shocks—could come off fast if tensions ease.
Forget headlines out of the Gulf for a minute—traders have eyes on just one thing: the U.S. payrolls number hits Friday at 8:30 a.m. ET. That’s a data point that can jolt the dollar and ripple straight into demand forecasts in seconds. Until then, ship-tracking screens are up, and the question hangs: do those escort promises and insurance deals actually get more tankers through Hormuz?
