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<\/p>\nHormuz tensions are flaring again as Iranian exports collapse, pushing Brent toward $87 and raising the risk of another run toward $100.<\/p>\n
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China\u2019s Crude Drawdown Puts Iranian Barrels Back in Demand<\/p>\n
– Shrinking crude inventories in China might spur a buying spree over the upcoming weeks, particularly for Russian and Iranian crude, buoyed<\/a> by a record-high July stock draw in Shandong.\u00a0\u00a0\u00a0<\/p>\n – Chinese teapots are expected to boost their purchases of Iranian oil in the upcoming days as stockpiles in the northeastern Shandong province have dropped by a whopping 35 million barrels in July, equivalent to a 1.1 million b\/d draw.<\/p>\n – The gradual re-opening of product exports from China is pushing utilization rates amongst independent refiners, with run rates around 50% currently after multi-year highs seen in June-July.<\/p>\n – Meanwhile, prices for Iranian barrels are edging higher as new supply from Kharg Island seems to be dissipating \u2013 in the first ten days of August, not a single VLCC was seen loading<\/a> in Iran.<\/p>\n – According to Kpler, Iranian crude held in floating storage remains relatively constant around 40 million barrels, double the amount seen in the first weeks of July when navigation was still unimpeded.<\/p>\n Market Movers<\/p>\n – US energy firms P66 (NYSE:PSX), Kinder Morgan (NYSE:KMI) and HF Sinclair (NYSE:DINO) have jointly agreed<\/a> to build the $5 billion Western Gateway pipeline system, a key conduit for refined products to California from St. Louis, MO.<\/p>\n – UK major BP (NYSE:BP) has agreed<\/a> to purchase a 70% interest in the Calypso deepwater offshore project in Trinidad and Tobago from Australia\u2019s Woodside (ASX:WDS), taking full ownership of the 3.5 TCf asset.<\/p>\n – Italian energy giant ENI (BIT:ENI) has signed<\/a> an agreement with US driller APA (NASDAQ:APA) to become a strategic partner in the latter\u2019s Block 6 offshore Uruguay, with ENI funding most of the exploration work planned for 2027.<\/p>\n – French upstream specialist Maurel et Prom (EPA:MAU), majority-owned by Indonesia\u2019s Pertamina, has agreed<\/a> to buy the entire South American portfolio of Gran Tierra Energy (mostly in Colombia and Ecuador) for a total consideration of $1.33 billion.<\/p>\n – ADNOC, the national oil company of the UAE, has bought<\/a> 6 VLCCs and 5 VLGCs on the secondary market for $1.3 billion, expanding its shipping capacity as it continues to navigate transits through the Strait of Hormuz.<\/p>\n Tuesday, August 11, 2026<\/p>\n The rapid slowdown in Hormuz transits, first Houthi casualties in the Red Sea, another bout of escalatory rhetoric from US President Trump, and once again it all seems that there was never really a deal in discussion. ICE Brent has bounced back to $87 per barrel; however, another rally towards $100 per barrel is firmly on the table as Iranian loadings are close to zero in August, raising the risks of Tehran halting Hormuz transits completely.<\/p>\n Trump Adds a New Price Tag to Hormuz Talks. The US president demanded<\/a> compensation from Iran for deaths across decades of conflicts after Tehran sought payment for wartime damage, further complicating negotiations to reopen the Hormuz Strait despite progressing Iran-Oman negotiations.\u00a0<\/p>\n Red Sea Attacks Lead to First Houthi Victims. Three sailors were killed<\/a> in a suspected Houthi attack on an Egyptian-owned cargo vessel in the Bab el-Mandeb Strait, whilst a Pakistani-flagged container ship Vela Nova was struck by a US helicopter missile in the Gulf of Oman as tensions escalate. OPEC Output Rebounds Despite Hormuz Woes. Oil production from OPEC countries rose by 1.17 million b\/d to 19.9 million b\/d, according to Reuters, as Gulf countries managed<\/a> to partially restore their output after a multi-decade low seen in May, with most upside coming from Iraq and Kuwait.\u00a0<\/p>\n Libya\u2019s Key Refinery Gets Shelled. A fuel-storage tank caught fire at the 120,000 b\/d Zawiya refinery just two days after a drone damaged another tank, prompting<\/a> Libya\u2019s NOC to declare an emergency and potentially halt operations completely just as the country\u2019s central bank governor resigned. Glencore Faces a Half-Billion-Dollar Iron Ore Question. After global traders Vitol and Cargill stopped doing business with Singapore-based iron ore trader Radiant World due to counterfeit invoices, Reuters reported<\/a> that Glencore\u2019s exposure to the disgraced buyer amounted to $500 million.\u00a0<\/p>\n UAE Gas Plots a Hormuz-Proof LNG Plant. ADNOC, the national oil company of Abu Dhabi, is exploring<\/a> a multibillion-dollar 9.6 mtpa export terminal on the country\u2019s east coast in Fujairah, connected to western gas fields by pipeline, seeking to minimize its Hormuz exposure completely. Canada Offers Concessions to Escape Trump\u2019s Tariffs. Trade negotiators from Canada and the US are discussing<\/a> a prospective deal that would remove Ottawa\u2019s tariffs on US cars and reconfigure dairy quotas in exchange for Washington dropping steel and aluminium tariffs on Canadian goods.<\/p>\n Rhine Oil Traffic Grinds to a Halt. Barge traffic along the River Rhine in Europe has stopped<\/a> with several ports across Germany and Switzerland cut off from refined product supply after water levels at the key Kaub chokepoint fell to a record-low 17 cm and could reach just 4 cm by mid-August. Disruptions Push Food Prices to a Three-Year High. The FAO food price index climbed<\/a> to 131.1 points in July, the highest since January 2023, as Black Sea shipping disruptions and crop heat damage lifted wheat prices by 6% vs June, while higher crude costs boosted vegetable oils and sugar.\u00a0<\/p>\n Aluminum Rallies as War Tightens Supply. LME aluminium prices climbed<\/a> for a 7th straight session to a seven-week high of $3,350 per tonne as shrinking inventories and repeated disruptions in flows from the Middle East – accounting for almost 9% of global capacity \u2013 tighten the market further.<\/p>\n Jellyfish Knock Out Three French Nuclear Reactors. A massive swarm of jellyfish forced<\/a> France\u2019s state energy company EDF to shut three reactors, 2.7 GW of capacity, at its Gravelines plant and halve output from another unit, compounding heat-related restrictions across France\u2019s nuclear fleet.<\/p>\n By Tom Kool for Oilprice.com<\/p>\n
Houthis Test Saudi Arabia\u2019s New Pact. Yemen\u2019s Houthi militia attacked<\/a> Aramco\u2019s 400,000 b\/d Jazan refinery just two days after Riyadh signed a collective-defense agreement with Turkey and Pakistan, marking a second successful attack in less than a month and keeping it shut until September.<\/p>\n
Trump Extends Jones Act Waiver with a Tighter Leash. US President Donald Trump has extended<\/a> his Jones Act waiver for another 90 days, but exemptions will now be reviewed voyage by voyage after 208 waivers in less than five months triggered backlash from domestic shipbuilders and lawmakers.<\/p>\n
Venezuela Shuffles Power Leadership After US Visit. Caracas appointed Corpoelec veteran Juan Fernandez to head the state utility while moving his predecessor into the deputy electricity minister role, days after US envoy John Barrett travelled<\/a> to the country to discuss improved power supply.\u00a0<\/p>\n
Japan May Subsidize a Hormuz Bypass. The Japanese government is considering<\/a> support measures to help refiners reduce their transportation costs for crude and naphtha shipments, incentivizing buyers that start diversifying away from the Middle East by partly covering their extra logistics costs.<\/p>\n