SINGAPORE / RankWire.AI / – Oil prices experienced a slight recovery on Tuesday following a drop of more than 2% in the previous session for Brent crude and WTI. Brent futures increased by 27 cents, or 0.3%, reaching $92.44 per barrel by 0330 GMT. Meanwhile, U.S. West Texas Intermediate rose by 37 cents, or 0.4%, to $85.38. This rebound came after Monday’s significant decline, which marked the end of six straight sessions of gains across both major crude benchmarks.
Brent crude closed $2.22 lower on Monday at $92.17 per barrel, a decrease of 2.35%. WTI also declined by $2.05, or 2.35%, ending the day at $85.01. During trading, the U.S. benchmark hit a one-week low. These losses followed recent gains over the past two weeks and were influenced by traders digesting new U.S. economic sanctions targeting Iran and companies linked to its business dealings.
The recent price movements kept Brent above the $90 mark per barrel amid ongoing geopolitical tensions and supply concerns. Since the U.S.-Israeli conflict with Iran began on February 28, oil supplies have been disrupted, including restrictions on shipping through the Strait of Hormuz. Prior to the outbreak of war, the strait’s transit volumes accounted for approximately 20% of global oil consumption.
U.S. sanctions broaden restrictions related to Iran
On Monday, the U.S. Department of the Treasury announced the initiation of Operation Economic Outcast and expanded sanctions targeting Iran-affiliated activities. These measures encompass digital assets, technology, gold, aviation, and maritime shipping. Nearly 60 entities, individuals, and vessels across various jurisdictions were also sanctioned. The sanctions targeted networks involved in Iranian oil transport and revenue, alongside groups linked to nuclear procurement, missile technology, and cyber operations.
The new sanctions framework empowers U.S. authorities to target foreign entities operating within or supporting the five newly designated Iranian economic sectors. The Treasury noted that countries will be given specific deadlines to address Iran-related activities identified by U.S. officials. These measures supplement existing restrictions on Iran’s petroleum and petrochemical industries. The decline in oil markets on Monday followed the announcement, after Brent and WTI had experienced six consecutive days of gains.
Strait of Hormuz incident coincides with declining U.S. oil reserves
Maritime security issues remain a key factor impacting physical oil flows. United Kingdom Maritime Trade Operations reported that an unidentified projectile struck and damaged an oil tanker near Oman. The attack occurred approximately 9 nautical miles, or 16.7 kilometers, northeast of Ash Shishah. Additionally, Iran identified 45 tankers on Monday that it claims violated its rules for crossing the Strait of Hormuz, warning of potential action against those vessels.
U.S. emergency oil inventories have also declined amid ongoing supply disruptions. The Department of Energy reported that crude stocks in the Strategic Petroleum Reserve decreased by roughly 3.7 million barrels last week, bringing the total to 289.7 million barrels — the lowest level since November 1982. Against this supply backdrop, Brent was trading at $92.44 early Tuesday, and WTI stood at $85.38 after both benchmarks recovered part of Monday’s losses.