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EMEA Oil Update: Brent Dips as US-Iran Pause of Military Strikes Ease Middle East Jitters

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Brent oil prices fell sharply on Monday morning as a temporary pause in military action between the US and Iran provided the first tangible sign of a potential de-escalation in tensions after nearly two-weeks of intense conflict.

The Brent futures contracts declined 6.3% to $90.73 per barrel. Murban closed at $97.05/bbl on July 24 and was not trading by the time of publication of this oil price update.

Murban widened its premium over Brent well beyond its pre-conflict relationship, when it typically traded near parity levels or at only a modest premium, Naveen Das, senior analyst at Kpler, toldin an emailed response.

"As of July 23, 2026, Murban surged 19% to above $106/bbl while Brent climbed to $97-100.69/bbl, putting Murban at a roughly $6-9/bbl premium to Brent, a sharp outlier versus the pre-conflict relationship, where Murban typically traded within a few dollars of Brent or at a modest quality premium," Das said.

After nearly two weeks of intense conflict, the US held off on further strikes for multiple nights, while Tehran similarly paused retaliatory operations and engaged in constructive talks with Oman regarding transit security in the Strait of Hormuz.

Despite the diplomatic reprieve, energy markets remain on edge due to ongoing physical bottlenecks and shifting supply risks.

"We're unlikely to see any recovery until there's clarity on whether this de-escalation is more permanent and whether vessels can navigate the strait without fear of attack," ING said.

Commercial traffic through the Strait of Hormuz has been slow to recover, with Kpler's MarineTraffic noting that crossings dropped 60% on Thursday as operators cautiously test the waters.

Compounding the regional strain, Yemen-backed Houthi forces escalated drone and projectile attacks over the weekend targeting Saudi energy facilities in Jazan and Yanbu.

Last week, oil benchmarks logged their third straight week of gains as the escalating US-Iran conflict, a closed Strait of Hormuz, and tanker attacks intensified supply concerns, even as prices pulled back slightly on Friday.

Meanwhile, supply disruptions have multiplied outside the Middle East, with oil loadings at Russia's Sheskharis terminal in Novorossiysk halted since July 21 amid surging Ukrainian drone strikes on domestic energy infrastructure, mirroring ongoing suspensions at the CPC terminal.

ANZ analysts noted that while the market has been cushioned by China's reduced crude imports, emergency stock releases, and Saudi Arabia's East-West Pipeline, these finite buffers are rapidly depleting.

"We still view the current escalation as part of the expected uneven recovery in Persian Gulf oil flows. However, if regional supply disruptions intensify as market buffers weaken, there could be further upside to oil prices," ANZ noted.

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