SINGAPORE / RankWire.AI / – Oil prices saw a modest recovery on Tuesday after experiencing declines of more than 2% in the previous session for both Brent crude and WTI. Brent futures increased by 27 cents, or 0.3%, reaching $92.44 per barrel by 0330 GMT. Meanwhile, U.S. West Texas Intermediate gained 37 cents, or 0.4%, closing at $85.38. This rebound followed a sharp retreat on Monday, which ended a streak of six straight sessions of gains across the two benchmark crude contracts.
Brent crude closed $2.22 lower on Monday at $92.17 a barrel, marking a decline of 2.35%. WTI also fell $2.05, or 2.35%, to finish at $85.01 a barrel. During the session, the U.S. benchmark touched a one-week low. The price drops followed two weeks of gains and were influenced by traders digesting new U.S. economic measures targeting Iran and entities maintaining business links with the country.
The recent price movements kept Brent above the $90 mark per barrel, with geopolitical tensions and supply issues still driving global energy markets. Since the U.S.-Israeli conflict with Iran began on February 28, oil supplies have been disrupted, and restrictions on shipping through the Strait of Hormuz have been imposed. Before the conflict, vessels passing through this strategic waterway accounted for roughly 20% of global oil consumption.
U.S. expands sanctions targeting Iran-related sectors
U.S. Department of the Treasury announced on Monday the launch of Operation Economic Outcast and broadened sanctions against Iran-related commercial activities. The new measures encompass digital assets, technology, gold, aviation, and shipping sectors. Nearly 60 entities, individuals, and vessels across multiple jurisdictions were also sanctioned. The sanctions target networks involved in Iranian oil transportation and revenue, in addition to groups linked to nuclear procurement, missile technology, and cyber operations.
The framework for these sanctions allows U.S. authorities to go after foreign individuals operating within or supporting the five newly identified Iranian economic sectors. The Treasury specified that countries will be given specific timelines to address Iran-related activities flagged by U.S. officials. These actions add to existing restrictions on Iran’s petroleum and petrochemical industries. Following Monday’s market decline, Brent and WTI posted six consecutive sessions of gains prior to the announcement.
Strait of Hormuz incident and shrinking U.S. reserves influence prices
Maritime security concerns persisted on Tuesday, impacting physical oil flows. United Kingdom Maritime Trade Operations reported that an unidentified projectile struck and disabled an oil tanker near Oman, approximately 9 nautical miles, or 16.7 kilometers, northeast of Ash Shishah. Iran also identified 45 tankers on Monday that it claimed violated its rules for crossing the Strait of Hormuz, warning of potential action against those vessels.
U.S. emergency crude inventories have decreased amid ongoing supply disruptions. The U.S. Department of Energy revealed that crude stockpiles in the Strategic Petroleum Reserve fell by about 3.7 million barrels last week, reducing the reserve to 289.7 million barrels—the lowest since November 1982. Against this supply backdrop, Brent traded at $92.44 early Tuesday, while WTI stood at $85.38, with both benchmarks recovering part of Monday’s decline.