OIL HITS THREE-WEEK HIGH AS MIDDLE EAST SUPPLY RISK BUILDS

Developing story: Crude prices, U.S. inventory data, Gulf shipping traffic and U.S.-Iran statements may change through the trading day.

Oil prices climbed to their highest levels in more than three weeks on Thursday as Middle East supply concerns intensified and the Strait of Hormuz remained far below normal traffic levels. Reuters reported that Brent crude rose to $93.81 a barrel, while U.S. West Texas Intermediate for September delivery climbed to $88.16.

Both major benchmarks gained for a fifth straight session and reached their highest levels since July 24. The move reflects a market that is no longer treating the Hormuz crisis as a short-lived disruption. Traders are now pricing the possibility that low shipping volumes, vessel attacks and diplomatic deadlock may persist.

The UAE’s suspension of trade and financial transactions with Iran added fresh pressure. The decision followed Emirati claims that two missiles launched from Iran targeted maritime traffic. Iran denied responsibility, but the suspension deepened the sense that Gulf commercial ties are being pulled into the war.

Reuters reported that traders were focused on lower Middle East exports, sporadic attacks and uncertainty around the United States and Iran. Trump said no talks were taking place with Tehran, while Iran said the Strait of Hormuz remained shut. Kpler data showed only nine commodity vessels transited Hormuz on both Tuesday and Wednesday.

Oil markets are also watching inventories. U.S. distillate fuel stockpiles, which include diesel and heating oil, have fallen for three consecutive weeks, according to Reuters. Tight distillate inventories can increase sensitivity to crude supply disruption because diesel is essential for trucking, agriculture, industry and heating.

The rise in oil prices has political consequences. Higher fuel costs feed inflation expectations and household pressure in the United States, Canada, Britain and Europe. In a midterm year, gasoline prices can quickly become a referendum on war management and economic competence.

Saudi and Iraqi export adjustments may ease some pressure, but they have not yet restored market confidence. Saudi Aramco has offered cargoes outside Hormuz, and Iraq is exploring multiple export mechanisms. Those steps show producers are adapting, but adaptation is not the same as a return to normal flows.

What is confirmed is that oil prices reached their highest levels since late July, driven by the unresolved U.S.-Iran conflict, UAE-Iran tension and weak Hormuz traffic. What remains unresolved is whether the risk premium stabilizes near current levels or grows into a broader energy shock if shipping and diplomacy deteriorate further.

Fact-check date: August 20, 2026. Article type: News. Sources: Reuters. Developing note: Crude prices, U.S. inventory data, Gulf shipping traffic and U.S.-Iran statements may change through the trading day.