NEW YORK — Oil prices edged higher on Thursday as uncertainty over the future of shipping through the Strait of Hormuz continued to support a risk premium in crude markets, although concerns about weaker global demand limited the gains.
Brent crude, the global benchmark, had moved toward $90 a barrel this week as stalled U.S.-Iran negotiations and reduced tanker traffic through the strategic waterway renewed concerns about disruptions to Middle Eastern oil supplies. U.S. West Texas Intermediate crude has also risen from recent lows.
The Strait of Hormuz, between Iran and Oman, is a critical route for global energy shipments. U.S. Energy Information Administration data show that oil flows through the strait averaged 14.6 million barrels per day in the first quarter of 2026, down sharply from more than 20 million barrels per day in each quarter of 2025.
The market remains sensitive to signs that the waterway could again face prolonged disruption. Shipping traffic increased after a June agreement between the United States and Iran aimed at ending their conflict and reopening the strait, but uncertainty has persisted. The EIA said in July that increased traffic and expectations of recovering production had led it to lower its outlook for crude prices.
The agency has also warned that disruptions to Middle Eastern production and shipping can produce substantial price volatility. In an analysis published in July, the EIA said Brent futures had traded between $72 and $118 a barrel during the second quarter, with disruptions through the Strait of Hormuz contributing to higher prices and volatility.
Recent market moves have reflected competing pressures. Geopolitical concerns have encouraged traders to price in the possibility of tighter supply, while expectations of weaker economic activity have weighed on demand. Oil prices fell on Thursday in some markets despite the continuing tensions, underscoring the volatility surrounding the outlook.
The EIA said in its latest available outlook that it expected global oil production and trade flows to move closer to pre-conflict levels, with most previously shut-in production returning by early 2027. It forecast Brent would average $74 a barrel in the third quarter of 2026, reflecting expectations of rising supply and slower inventory withdrawals.
For now, traders remain focused on developments affecting tanker movements through the Strait of Hormuz and on any further diplomatic progress between Washington and Tehran.
