Oil prices rose 6.7% in a week, but information about the US military securing the passage of ships through the Strait of Hormuz is increasing pressure on prices

Oil prices have risen 13% in two weeks due to the lack of progress in US-Iran negotiations and the blockade of the Strait of Hormuz, but more news emerged over the weekend that could change the trend in oil prices.

October Brent crude futures rose another 6.7% to $94.5/barrel last week (+13.2% in two weeks, +3.3% in the month), but have fallen 1.5% to $93/barrel since the start of trading on Asian markets on Monday.

US Treasury Secretary Scott Bessant announced in a post on X that “economic D-Day is beginning — the largest financial offensive ever directed against an adversary.” It is expected that all of Iran’s partners who help it trade will be subject to sanctions.

The US continues to effectively block oil exports from Iran, and there have been no oil shipments from Iranian ports for over a month, which continues to drive Iran's economy towards collapse.

According to Axios (a source close to U.S. officials), about 40 tankers were able to pass through the southern corridor of the Strait of Hormuz in both directions on August 21, transporting about 16 million barrels of oil per day. According to data from the UK Maritime Trade Operations (UKMTO) analyzed by CNN, almost 200 ships passed through the strait last week — 103 entered and 89 left.

Iran's influence in the Strait of Hormuz has diminished after the US military struck Iranian radars and ship detection devices on the shores of the Gulf, "blinding" the IRGC, which allowed commercial shipping traffic through the southern corridor of the strait to increase by almost 4 times in the past two weeks.

Iranian President Masoud Pezeshkian said on Friday that "it would be better to end the war today, now that we are strong and have dignity, when the whole world recognizes our victory." This is also evidence that the official government understands the weakness of the economy and that now it has the last chance to get out of the war, preserving state governance and preventing civil war in the country.

Earlier, the Iranian state news agency IRNA reported that after repeated requests from Baghdad, Tehran allowed several Iraqi oil tankers to pass through the Strait of Hormuz.

We believe that the US, UAE and SA will increase sanctions pressure on Iran in order to resume negotiations with the US, and reducing Iran's ability to block the passage of ships through the Strait of Hormuz will remove the last strong lever of influence of the IRGC on the US, so oil prices will fall to the level of $75-85/barrel.