Brent crude fell 1.87% to $92.63 on Monday, giving back part of last week's rally as traders assessed Washington's escalating pressure campaign on Iran. West Texas Intermediate slid 1.97% to $85.35, with the selling running across the energy complex as natural gas, gasoline, and heating oil each lost between 1.68% and 1.88%. Both benchmarks had gained more than 5% last week on the escalating rhetoric before Monday's reversal. The latest decline points to supply news rather than policy outlook, as ship transits through the Strait of Hormuz climbed from 39 to 192 over two weeks, a 392% rise, according to BeInCrypto. However, traffic still sits roughly 90% below pre-war levels, when about 20.9 million barrels a day moved through the waterway, according to EIA figures.
US Treasury Secretary Scott Bessent is set to hold a press conference at 2 p.m. EDT on Monday, with Bessent threatening to impose "the toughest sanctions in history" on Iran. President Donald Trump has also threatened sanctions against countries trading with Iran, as reported by The Economic Times. President Donald Trump announced what he described as the "most crushing economic operation ever taken against any country" on August 19, warning that nations providing financial, commercial, or other support to Tehran could face severe economic consequences. "This will be an ECONOMIC D-DAY, and we need all of our Allies to stand with the United States of America to isolate, and defeat, the Iran threat," Trump said. Bessent made the same case in a Financial Times opinion piece published Sunday, writing that an economic D-DAY begins at dawn. In an interview to CNBC last week, US Treasury Secretary Scott Bessent had said that the US would impose the 'toughest sanctions in history' on Iran. Referring to US plans to crush Iran's economy, he said it will likely negate the need for major US military operations against Iran.
Iran dismissed the campaign, with Hossein Mohebbi, spokesman for the Islamic Revolutionary Guard Corps, calling it an admission of military defeat, according to TASS. "[US President Donald] Trump's executive order on the launch of the toughest economic warfare against Iran mounts to a tacit acknowledgement of Washington's defeat on the military front," he said. Mohsen Rezaei, secretary of Iran's Supreme National Security Council, threatened to halt oil flows through the strait entirely. Iran has criticised Washington's plans for new sanctions, while President Masoud Pezeshkian has called for a diplomatic solution, as reported by The Economic Times. Iran's leadership is currently split between choosing to de-escalate or confront the mounting challenges, creating uncertainty in the region. According to IG markets analyst Tony Sycamore, "The more pragmatic members of the Iranian leadership would prefer to de-escalate but the hardliners would probably prefer to fight to the bitter end." "I think by the end of this week we will have a good idea which side of the Iranian leadership has the upper hand," he added. Meanwhile, Iran's National Security Council secretary Mohsen Rezaei warned that Iran would take decisive action if any neighbouring country joined the US-proposed economic warfare.
The strategic importance of the Strait of Hormuz has become dramatically visible as crude oil and petroleum liquids moving through Hormuz fell from about 21.6 million barrels a day in the fourth quarter of 2025 to 4.9 million barrels a day in the second quarter of 2026. However, Monday's increase reflects ships restoring signals rather than fresh cargo, as many captains switch off transponders in a war zone. About half of the traffic Kpler has tracked through the Strait of Hormuz in recent weeks has consisted of shadow transits, up from around one-eighth a month ago, as Iranian ships and their Houthi allies try to conceal their locations to avoid attack. Iran allowed several Iraqi oil tankers to travel through the Strait of Hormuz after repeated requests from Baghdad, according to Iran's state news agency IRNA. Offers of Iranian crude to Chinese buyers have fallen and prices have risen as the US blockade has cut Tehran's shipments, according to trade sources. The unresolved question is China, which buys more than 80% of Iran's shipped oil according to Kpler.
At 10.03 am on Monday, November Brent oil futures were at $91.30, down by 1.48 per cent, and October crude oil futures on WTI (West Texas Intermediate) were at $85.59, down by 1.69 per cent, according to The Hindu BusinessLine. September crude oil futures were trading at ₹8205 on Multi Commodity Exchange (MCX) during the initial hour of trading on Monday against the previous close of ₹8359, down by 1.84 per cent, and October futures were trading at ₹8050 against the previous close of ₹8181, down by 1.60 per cent. September natural gas futures were trading at ₹267.20 on MCX during the initial hour of trading on Monday against the previous close of ₹269.70, down by 0.93 per cent. On the National Commodities and Derivatives Exchange (NCDEX), September guargum contracts were trading at ₹12090 in the initial hour of trading on Monday against the previous close of ₹11952, up by 1.15 per cent, and October dhaniya futures were trading at ₹16308 on NCDEX in the initial hour of trading on Monday against the previous close of ₹16212, up by 0.59 per cent. JPMorgan estimates that every additional month of disruption could add around $7 to $8 a barrel to Brent prices, with the bank expecting average monthly Brent prices to reach around $114 a barrel if the disruption lasts for three months. Goldman Sachs has also warned that Brent could rise to $120 a barrel if shipping disruptions through the Strait of Hormuz continue, according to The Economic Times. Goldman Sachs expects tensions in the Middle East to eventually ease under its base case, forecasting Brent to average $80 a barrel in the fourth quarter and $75 a barrel next year. Analysts now expect Brent prices to average at $86 per barrel during the quarter, up from their previous estimate of $85 per barrel, according to Reuters. As a result of these factors, they increased their FY27 Brent estimate from $82 per barrel to $84 per barrel. Global oil inventories have declined to between 1.5 billion and 1.9 billion barrels below their levels at the start of the war, with the market remaining in deficit despite higher-than-expected flows through the Strait of Hormuz.
