SINGAPORE / RankWire.AI / – Oil prices experienced a slight bounce on Tuesday after both Brent crude and WTI declined over 2% in the previous trading session. By 0330 GMT, Brent futures increased by 27 cents, or 0.3%, reaching $92.44 per barrel. Meanwhile, U.S. West Texas Intermediate gained 37 cents, or 0.4%, closing at $85.38. This rebound came after Monday’s notable drop, which marked the end of six consecutive sessions of gains for the two major crude benchmarks.
Brent crude closed $2.22 lower on Monday at $92.17 a barrel, representing a 2.35% decline. WTI also fell by $2.05, or 2.35%, ending the session at $85.01 a barrel. During the day, the U.S. benchmark hit a one-week low. The decrease followed gains accumulated over the previous two weeks, with traders also reacting to new U.S. economic measures targeting Iran and entities conducting business with the country.
The recent price shifts kept Brent above the $90 threshold while geopolitical tensions and supply issues continued to influence global energy markets. Since the start of the U.S.-Israeli conflict with Iran on February 28, oil supplies have been disrupted. Restrictions on shipping through the Strait of Hormuz have also increased during the ongoing conflict. Prior to the war, vessels passing through the strait accounted for roughly 20% of worldwide 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-associated activities. These measures include restrictions on digital assets, technology, gold, aviation, and shipping sectors. Nearly 60 entities, individuals, and vessels across various jurisdictions were also sanctioned. The actions targeted networks linked to Iranian oil transportation and revenue, as well as groups involved in nuclear procurement, missile technology, and cyber operations.
Additionally, the sanctions framework enables U.S. authorities to target foreign persons operating within or supporting the five newly designated Iranian economic sectors. Treasury specified that countries will be given set timelines to address Iran-related activities identified by U.S. officials. These measures supplement existing restrictions on Iran’s petroleum and petrochemical industries. The decline in oil prices on Monday followed the sanctions announcement, which came after Brent and WTI experienced six consecutive days of gains.
Incidents near Hormuz coincide with declining U.S. reserves
Maritime security issues continued to influence physical oil flows on Tuesday. United Kingdom Maritime Trade Operations reported that an unidentified projectile struck and damaged an oil tanker near Oman. The incident occurred approximately 9 nautical miles, or 16.7 kilometers, northeast of Ash Shishah. Iran also identified 45 tankers on Monday that it claimed violated its crossing rules for the Strait of Hormuz, warning of potential action against those vessels.
Meanwhile, U.S. emergency oil stockpiles have shrunk amid supply disruptions. The U.S. Department of Energy reported a decrease of about 3.7 million barrels in crude stocks last week in the Strategic Petroleum Reserve. This brought the reserve to 289.7 million barrels, the lowest level since November 1982. Against this backdrop of tightening supplies, Brent traded at $92.44 early Tuesday, and WTI stood at $85.38 after both benchmarks regained some of Monday’s losses.