Crude oil nears $84 as Strait of Hormuz risks persist

Crude oil advanced toward $84 per barrel on Tuesday, extending its winning streak, as uncertainty surrounding a potential US-Iran agreement and the reopening of the Strait of Hormuz continued to underpin prices. Negotiations remain fraught with complications after the US imposed sweeping demands on Iran, while Tehran continues to seek reparations as part of efforts to end the conflict. The absence of an agreement between Iran and Oman to reopen the strategic waterway is adding to supply-side apprehensions, with Tehran linking any reopening to progress with Washington. Meanwhile, the dollar index held near 99.7 ahead of key US inflation readings, with markets awaiting fresh clues on the Federal Reserve?s policy trajectory following a disappointing July jobs report. MCX crude oil futures for August delivery climbed more than 2% to Rs 7,964 per barrel, after touching Rs 7,993 earlier in the session. Meanwhile, Energy Information Administration or EIA stated in its latest Short Term Energy Outlook that expectations of increasing oil supply and moderating inventory draws have caused oil prices to fall. The Brent crude oil spot price averaged $85 per barrel (b) in June, down $22/b from May and $32/b from its recent April 2026 peak. The Brent price in its forecast averages $74/b in 3Q26, a reduction of $27/b from last month?s outlook. It expects ongoing oil inventory accumulation over the next year will continue to put downward pressure on crude oil prices, with Brent falling to an average of $65/b in 2027.

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