NEW YORK / RankWire.AI / – On July 29, in the oil markets, Brent crude rose above the $90 per barrel mark as traders reacted to tightening supplies and escalating conflicts in the Middle East. Brent closed at $90.74, a rise of $6.65, or 7.9%, during the trading session. Meanwhile, West Texas Intermediate increased by $5.20, or 6.6%, to settle at $84.46. These gains represented the most substantial daily advances for both benchmarks in several weeks. Oil prices also extended their July rally, which saw both contracts rise more than 20%.
Market sentiment was influenced by military activity near significant production and shipping hubs. U.S. and Saudi forces targeted Iran-backed groups in Iraq following drone assaults on Saudi oil facilities. Iran also reported attacks on vessels near the Strait of Hormuz and on U.S. military installations in Jordan. During the same timeframe, explosions impacted a natural gas loading site in Egypt. Maritime security firm Ambrey reported damage to a U.S.-owned floating storage tanker at the Egyptian site.
These conflicts disrupted traffic along key routes used by global energy exporters. Commercial shipping remained limited in parts of the Gulf and the Red Sea. The Strait of Hormuz accounts for a significant share of oil exports from Persian Gulf producers. The Bab el-Mandeb Strait links Red Sea shipping lanes to markets in Asia and Europe. Delays along these routes affected cargo schedules and heightened pressure on available supplies. Traders closely monitored damage reports near energy facilities and transport infrastructure.
U.S. crude inventories decline sharply
The rise in crude prices on July 29 was supported by U.S. inventory data showing a substantial decline. The Energy Information Administration reported a decrease of 7.2 million barrels in commercial oil stocks. Inventories dropped to 404.5 million barrels, their lowest since 2018, excluding crude stored in the Strategic Petroleum Reserve. The report confirmed a significant weekly reduction in U.S. supplies, coinciding with market concerns over transportation disruptions, military strikes, and damage near regional energy facilities.
On August 3, oil prices tumbled sharply after the United States halted another planned strike against Iran. President Donald Trump announced efforts to reach an agreement on Iran’s nuclear program and the Strait of Hormuz. Brent fell by $4.49, or 5.1%, to $83.44 in early trading. West Texas Intermediate declined by $4.90, or 5.8%, to $79.77. This decline erased much of the July 29 rally within three trading sessions.
OPEC+ approves additional production for September amid price dips
In response to falling prices, OPEC+ authorized an increase in output for September, raising its target by approximately 188,000 barrels per day. This move effectively reversed 1.65 million barrels per day of voluntary cuts made earlier in 2023. The decision involved Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman, all of whom agreed to ongoing monthly reviews of market conditions and compliance levels. Their next assessment is scheduled for September 6.
Despite the August pullback, Brent and WTI prices remained above their average levels in June. Brent’s spot crude averaged $85 a barrel that month, which is $22 below the May average and $32 beneath the April 2026 peak. The energy outlook for July projected an average Brent price of $82 for 2026. The movement above $90 on July 29 was driven by lower U.S. inventories, constrained shipping routes, and ongoing conflicts near major oil and gas infrastructure.