SINGAPORE / RankWire.AI / – Oil prices declined once again on Thursday, marking a continuation of a multi-day downward trend as market attention remained focused on developments around the Strait of Hormuz. At 0330 GMT, Brent crude futures decreased by 41 cents, or 0.5%, reaching $87.43 per barrel. Meanwhile, West Texas Intermediate crude futures dropped by 37 cents, or 0.5%, to stand at $81.86 per barrel. Brent was heading toward its fourth consecutive daily decline, and WTI was approaching its fifth straight session of losses, with both benchmarks trading below their Wednesday settlement prices during early Asian market hours.
This movement followed a weaker trading session on Wednesday, where both crude benchmarks closed lower after experiencing notable intraday volatility. Brent settled 74 cents lower, or 0.84%, at $87.84 per barrel, while WTI ended 13 cents down, or 0.16%, at $82.23. Earlier that day, Brent had fallen approximately 2%, and WTI about 1.8%. Both contracts had also shed over 3% during the previous session, continuing a broader correction that had been ongoing since earlier in the week for both benchmarks.
Market focus remained heavily on negotiations involving Iran and Oman, as these discussions continue to revolve around the strategic Strait of Hormuz, a vital waterway linking key Gulf oil producers to global markets and facilitating the transit of substantial energy shipments. The diplomatic activity involving Qatar also captured attention as regional talks persisted Thursday. These negotiations come amid a persistent decline in crude prices that have extended over multiple sessions. The passage through Hormuz remains a critical factor influencing Middle Eastern oil exports, with the strait located between Iran and Oman at the gateway to the Persian Gulf.
Hormuz negotiations continue to influence the oil market
The Strait of Hormuz is recognized as one of the world’s most crucial routes for the transportation of crude oil and natural gas. Since regional tensions intensified earlier this year, restrictions on transit through the strait have disrupted the usual energy flows from the Gulf, forcing alternative routes that are only capable of handling a portion of the typical volume. The level of shipping activity there directly impacts how much regional supply reaches international markets, which has caused oil prices to fluctuate within a volatile range amid shifting physical supply conditions across the region.
This week’s market outlook was further influenced by US inventory data, which added an additional confirmed measure of supply. The U.S. Energy Information Administration reported that commercial crude inventories increased by 95,000 barrels to a total of 428.9 million barrels, covering the week ending August 21. This follows several weeks of closely monitored inventory changes. Following the release of this data, crude prices recovered some of Wednesday’s earlier losses, although both Brent and WTI still finished the session below their previous closing levels.
September supply adjustments influence market dynamics
Supply policy considerations remained an integral part of the overall oil market backdrop as the month of September approached. Previously, OPEC+ approved a production adjustment of 188,000 barrels per day for seven member countries starting in September. This decision involved Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman, with those nations reaffirming their commitments to both production conformity and compensation for previous overproduction. The group also scheduled its next monthly meeting for September 6, adding a further scheduled event that could influence supply expectations.
Thursday’s price declines pushed Brent below $88 and WTI below $82 during early Asian trade, marking a streak of four consecutive declines for Brent and five for WTI. Despite this downward movement, current prices remain above some of the earlier levels observed this year. US crude inventories, after the latest weekly increase, stood at 428.9 million barrels. As the week advanced, oil markets continued to monitor confirmed shipping developments, physical supply data, and inventory figures, all of which shape the ongoing price trends.