Oil prices climb on Hormuz shipping attacks as IEA cuts 2026 supply forecast

Price reaction and contract moves

Oil futures rose on Aug. 12 following separate attacks on shipping in the Strait of Hormuz and the Bab el-Mandeb Strait, reinforcing worries about Middle East supply disruptions. Brent gained 90 cents, or 1 percent, to $89.81 a barrel by 0757 GMT, marking a sixth straight daily gain. U.S. West Texas Intermediate (WTI) crude climbed 88 cents, or 1.1 percent, to $84.08, up for a fifth session. Both benchmarks had earlier traded more than $1 higher.

Shipping disruptions in the Strait of Hormuz

The United States and Yemen's Iran-aligned Houthis reported separate attacks on shipping in Hormuz and Bab el-Mandeb on Tuesday, two export routes for Middle Eastern oil and gas alongside the Suez Canal. Iran's top security official said Hormuz would stay closed unless the United States accepted Iran's conditions to end the war, including release of frozen Iranian assets. Shipping data showed only eight vessels transiting Hormuz on Tuesday, a one-week low, compared with 125 to 140 vessels per day before the war.

IEA cuts 2026 supply outlook

The International Energy Agency trimmed its 2026 oil supply forecast as the Hormuz reopening stalled, compounding pressure on global crude balances. The IEA attributed the revision to a Hormuz closure that it said is squeezing the global economy and intensifying oil demand destruction. The agency expects significant disruptions to Middle East crude supplies to persist through the end of 2027, with 2026 Brent projected to average $86.81 a barrel and WTI to average $80.88, according to U.S. Energy Information Administration assumptions cited alongside the IEA report.

U.S. inventory build and upcoming EIA data

Industry data pointed in the opposite direction. A Reuters poll had expected U.S. crude and fuel inventories to fall last week, but market sources citing American Petroleum Institute figures said crude stocks rose by about 9.1 million barrels, the largest build in roughly 3.5 years, while gasoline inventories fell 1.5 million barrels and distillate stocks fell 596,000 barrels. Analysts at Haitong Futures said the crude build, if confirmed by official data, could ease concerns about supply tightness. The EIA's weekly petroleum status report was scheduled for 10:30 a.m. ET (1430 GMT) on Aug. 12.

Secondary supply developments

In Libya, the National Oil Corporation said all fires at fuel storage tanks in the Zawiya oil complex were under control, removing a near-term supply risk from the unrest that had periodically disrupted the country's exports.

Near-term milestones

Traders were watching the EIA's 10:30 a.m. ET weekly inventory release for confirmation of the API-reported crude build, along with any updates on U.S.-Iran diplomacy that could affect the status of Hormuz transit.