DTN Oil Update
Oil Rises on Hormuz Attack; U.S. Ends Iran Sanction Waiver
SECAUCUS, NJ (DTN) -- Crude futures rose Tuesday after a second attack within a week on a laden tanker in the Strait of Hormuz sent geopolitical premium for oil soaring anew. The U.S. Treasury's cancellation of a temporary 60-day sanctions waiver on Iranian oil, following the attack, also boosted the market.
The upside was, however, limited by lower crude prices forecast by the U.S. Energy Administration (EIA) in its Short-Term Outlook (STEO) amid projections of higher supply in the coming months.
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NYMEX WTI crude for August delivery rose $1.89 to settle at $68.62 bbl. ICE Brent crude for September rose $2.17 to close at $74.16 bbl.
Downstream, NYMEX ULSD for August climbed $0.00033 to finish at $3.3017 gallon. Gasoline, however, bucked the trend, with August futures on NYMEX slipping $0.0494 to $2.9539 gallon.
Crude futures rose after reports that Iran's military had fired on a second tanker in the Strait of Hormuz within a week, effectively ending a halt in attacks negotiated under a recent U.S.-Iran understanding.
Responding to the attack, the U.S. Treasury's Office of Foreign Assets Control (OFAC) said it has revoked General License X, the sweeping authorization issued on June 22 that had permitted the production, delivery, and sale of Iranian-origin crude oil, petrochemical products and petroleum products.
The EIA, meanwhile, said it has slashed its global crude price forecasts under its STEO in the wake of improving oil supplies out of the Middle East.
The 2026 annual average for Brent crude is forecast at $81.91 bbl, dropping significantly from the $95 bbl projected in the June outlook, the EIA said.
For 2027, Brent is seen averaging $64.76 bbl as expanding global supplies shift the market back into oversupply.
For WTI, the 2026 projection has been cut to $76.26 bbl from the prior expectation of $88.32 bbl. The 2027 WTI price forecast was set at $60.76 bbl.
Market participants are also awaiting the American Petroleum Institute's weekly update on oil and product inventories for the week ended July 3, at 4.30 p.m. EDT. The EIA will release official stockpiles data for the same week at 10.30 a.m. EDT on Wednesday.