Oil Prices Drop 0.6% Amid M.East Conflict
On 24 July 2026, Reuters reported that oil prices slipped in Asian trade on Friday but are poised for a third straight week of strong gains as tensions between the United States and Iran intensify and supply disruptions in the Middle East persist. Brent crude futures declined 0.6% to $100.09 a barrel by 21:07 ET (01:07 GMT), while West Texas Intermediate (WTI) futures fell 0.6% to $91.62 a barrel.
Despite the Friday pull‑back, Brent has risen 14% over the week, marking its third consecutive week of sharp gains. The rally is attributed primarily to renewed military confrontations between the United States and Iran and to attacks by Yemen’s Iran‑backed Houthi group on Saudi‑flagged tankers transiting the Red Sea. The Houthis targeted vessels in the Bab al‑Mandap Strait, and later in the Bab el‑Mandeb Strait, signalling a willingness to disrupt Saudi oil shipments and threatening a naval blockade of Saudi Arabia.
U.S. President Donald Trump, on Thursday, warned of “major military punishment” against both Iran and the Houthis following the Red Sea strikes. He also stated that “Iranian money” would be used to repair any damage to ships, cargo, or related infrastructure. The New York Times reported that Iran rejected a U.S.–backed cease‑fire proposal, indicating that diplomatic efforts have largely collapsed.
The article notes that traffic through the Strait of Hormuz has largely stalled, while the Red Sea corridor remains vulnerable, prompting Saudi Arabia to rely more heavily on the Bab al‑Mandap route to bypass Hormuz disruptions. Global oil inventories are perceived to be tightening in July after a brief respite in the previous month, with the ongoing Middle East conflict offering little prospect of supply improvement.
Analysts highlighted that the surge in oil prices is fuelling concerns about sticky, energy‑driven inflation, which could prompt major global central banks to adopt a more hawkish stance.