2 weeks ago
EIA warns Hormuz disruptions will keep pressure on oil markets
The Strait of Hormuz is a narrow waterway where many ships carry oil.
Lately, it has been hard for ships to pass through it.
The U.S. Energy Information Administration made a report about this.
The report says the problem will last through August.
It says a type of oil called Brent crude may cost about $85 per barrel.
That is $11 more than experts thought one month ago.
In September, shipping should slowly get better.
Then oil prices could drop to about $78 per barrel.
A huge amount of oil production stopped in July.
Because oil is so important, higher prices can make many things we buy more expensive.
The EIA expects severe constraints on Strait of Hormuz shipping to persist through August, with traffic gradually increasing beginning in September.
The agency forecasts Brent crude to average around $85 per barrel in Q3 2026, $11 higher than its forecast one month ago.
Brent prices are expected to ease to around $78 per barrel in Q4 2026 as shipping increases and more production comes back online.
Roughly 5.5 million barrels per day of Middle Eastern oil production was offline in July, equivalent to more than 5% of global oil consumption.
The Trump administration says the U.S. has 'total control' of the Strait and has disputed estimates of how limited shipping traffic remains.
- Who
- The U.S. Energy Information Administration (EIA) and the Trump administration
- What
- The EIA warned that Strait of Hormuz shipping constraints will keep pressure on global oil markets and raise crude prices
- Where
- The Strait of Hormuz, which connects the Persian Gulf with the Gulf of Oman and the Arabian Sea
- When
- Reported in the latest EIA Short-Term Energy Outlook; constraints expected through August with recovery beginning September 2026
- Why
- Reduced shipments through the waterway and offline Middle Eastern oil production are drawing down global inventories and lifting prices
EIA assessment
Trump administration view
Shipping conditions in the Strait of Hormuz
EIA assessment
The EIA expects severe constraints on shipping to persist through August, with inventories further drawn down and prices staying high.
Trump administration view
The administration says the U.S. has 'total control' of the Strait, points to improvements in the movement of oil, and disputes estimates of how limited shipping traffic remains.
Key facts
- Agency
- U.S. Energy Information Administration (EIA)
- Report
- Short-Term Energy Outlook
- Q3 2026 Brent forecast
- ~$85 per barrel (up $11 from prior month)
- Q4 2026 Brent forecast
- ~$78 per barrel
- 2026 full-year Brent average
- ~$87 per barrel
- 2027 Brent forecast
- ~$69 per barrel
- Offline Middle East production (July)
- ~5.5 million barrels per day (>5% of global consumption)
- Production expected to stay offline through end-2027
- ~600,000 barrels per day
Quotes
President Donald Trump
U.S. President
“the United States has ‘total control’ of the Strait”
wionews.com
Sources
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