SINGAPORE / RankWire.AI / – Oil prices edged upward on Tuesday following a significant drop of over 2% in the previous session for both main crude benchmarks. Brent crude increased by 27 cents to $92.44 a barrel at 0330 GMT, while U.S. West Texas Intermediate (WTI) gained 37 cents to $85.38. This rebound came after a six-day rally that culminated with Monday’s widespread decline in energy markets.
Brent settled Monday at $92.17 a barrel, reflecting a $2.22, or 2.35%, decrease from the prior close. WTI closed at $85.01, down $2.05, marking the same 2.35% drop. During trading, the U.S. benchmark hit a low not seen in a week. Despite gains in the two preceding weeks, prices reversed course amid new U.S. sanctions measures related to Iran, causing market sentiment to shift.
Market attention continues to focus on the supply situation, heavily influenced by ongoing tensions involving the United States, Israel, and Iran. The conflict, which began on February 28, has disrupted parts of the regional energy trade and impacted shipping lanes through the Strait of Hormuz. Before hostilities escalated, roughly one-fifth of global oil consumption moved through this strategic waterway.
U.S. broadens sanctions targeting Iran’s economic sectors
U.S. Department of the Treasury launched Operation Economic Outcast on Monday, expanding sanctions on Iran-related commercial activities. The new measures target digital assets, technology, gold, aviation, and shipping sectors. Authorities also imposed sanctions on nearly 60 entities, individuals, and vessels across multiple jurisdictions. These actions target networks associated with Iranian oil transport and revenue, as well as groups involved in nuclear procurement, missile development, and cyber activities.
This updated framework empowers U.S. officials to target foreign entities operating within or supporting five specific sectors of Iran’s economy. Furthermore, countries are given deadlines to address activities covered by the new restrictions. While existing U.S. sanctions already affect Iran’s petroleum and petrochemical industries, Brent and WTI prices declined following the announcement, halting a six-session winning streak.
Shipping hazards increase amid declining U.S. oil reserves
Maritime security concerns persisted on Tuesday as a British Maritime Trade Operations report detailed an unidentified projectile hitting and disabling an oil tanker near Oman. The incident took place approximately 9 nautical miles northeast of Ash Shishah. Meanwhile, Iran identified 45 tankers it claims have violated crossing rules in the Strait of Hormuz, threatening to take action against those vessels.
U.S. emergency crude inventories have fallen amid the ongoing supply disruptions. The U.S. Department of Energy reported a weekly decrease of about 3.7 million barrels in the Strategic Petroleum Reserve, which now stands at 289.7 million barrels—the lowest level since November 1982. Early Tuesday, Brent traded at $92.44, while WTI recovered some of Monday’s losses to trade at $85.38.