Brent oil prices edged lower in early Tuesday trading, hovering just above $91 per barrel. The US dollar’s rebound from the multi-month low reached at the end of the previous week allowed the price of dollar-denominated crude to ease slightly. At the same time, there has been a relatively muted market reaction to the latest US sanctions against Iran, with investors appearing to interpret Washington’s increasing reliance on economic pressure as reducing the immediate risk of further military escalation and the potential for more widespread damage to the region’s energy infrastructure. However, the scope for a more substantial decline in oil prices remains limited, as the Strait of Hormuz continues to operate well below pre-war levels. Against this backdrop, oil traders will remain focused on developments in the US-Iran conflict. The risks associated with further disruption could become increasingly significant as global inventories are depleted by several months of constrained supply from the Persian Gulf, which normally accounts for approximately 20% of global oil exports.
Ricardo Evangelista, ActivTrades
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