SINGAPORE / RankWire.AI / – Oil prices declined once more on Thursday, extending a multi-day downward trend as traders monitored developments around the Strait of Hormuz. Brent crude futures decreased by 41 cents, or 0.5%, to reach $87.43 a barrel at 0330 GMT. West Texas Intermediate crude futures also fell by 37 cents, or 0.5%, settling at $81.86 a barrel. Brent was on track for a fourth consecutive daily decrease, while WTI was approaching its fifth straight session of losses. These declines kept both benchmarks below their Wednesday settlement prices during early Asian trading hours.
The decline followed a weaker trading session on Wednesday, when both benchmarks closed lower after sharp intraday swings. Brent finished 74 cents lower, or 0.84%, at $87.84 per barrel, while WTI declined by 13 cents, or 0.16%, ending at $82.23. Earlier that day, Brent had dropped roughly 2%, and WTI about 1.8%. Both contracts experienced losses of over 3% in the previous session as well. The ongoing decline reflects a broader pullback that started earlier in the week across both crude benchmarks.
Negotiations involving Iran and Oman continue to dominate market attention, as they relate to the Strait of Hormuz. This strategic waterway connects key Gulf oil producers with global markets and handles significant energy shipments. Traders also observed diplomatic movements involving Qatar amid ongoing regional discussions Thursday. These diplomatic developments coincided with crude prices extending their multi-session decline. Shipping access through Hormuz remains crucial for the flow of Middle Eastern oil exports, given its position between Iran and Oman at the Gulf entrance.
Hormuz diplomacy remains vital for oil market dynamics
The Strait of Hormuz is among the world’s most critical routes for transporting crude oil and natural gas. Since regional conflicts intensified this year, restrictions on maritime traffic have disrupted normal energy flows from the Gulf region. Alternative pathways exist but can only handle a portion of the volume usually transported through the strait. The level of shipping activity there directly influences the amount of regional supplies reaching international markets. Recently, oil prices have experienced volatility within a broad range, driven by shifting physical supply conditions across the region.
Additional supply insights emerged from U.S. inventory figures this week, providing a clearer picture of regional availability. The U.S. Energy Information Administration reported that commercial crude stocks increased by 95,000 barrels to reach 428.9 million. This update covered the week ending August 21 and followed several weeks of closely observed stock fluctuations. After the inventory data was released, crude prices recovered some of Wednesday’s earlier declines. Nonetheless, both Brent and WTI still closed below their previous session’s levels.
September supply adjustments influence market outlook
Supply policy developments also remain in focus ahead of September. Previously, OPEC+ approved a production adjustment of 188,000 barrels per day for seven member countries starting that month. The participating nations include Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman. These countries reaffirmed their commitments to production quotas and measures to compensate for previous overproduction. The group scheduled its next monthly meeting for September 6, adding another anticipated supply event to the market calendar.
Thursday’s price decline pushed Brent below $88 and WTI under $82 during early Asian trading. Brent had experienced four consecutive days of decline, with WTI dropping for five. Despite this, current prices remain above levels seen earlier this year. U.S. crude inventories stood at 428.9 million barrels after the latest weekly increase. Throughout the week, oil markets continued to monitor confirmed shipping activities, physical supply levels, and inventory data, all influencing market sentiment.