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US Oil Update: Crude Little Changed as Markets Weigh US-Iran Talks, Weak Demand

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Crude futures were little changed in after-hours trading on Wednesday as markets weighed downward revisions to global demand forecasts against persistent supply risks amid the US-Iran talks impasse and ongoing maritime security risks.

Front-month West Texas Intermediate crude futures slipped by 0.75% to $82.58 per barrel, while Brent futures eased by 0.48% to $88.48/bbl.

Gelber & Associates strategists said that a reported build in US crude inventories is limiting the upside, although declines in gasoline and distillate stocks point to firmer demand for refined products.

US commercial crude oil inventories increased by 17.4 million barrels to 424.4 mmbbls in the week ended Aug. 7, the Energy Information Administration said in its weekly report on Wednesday.

Crude inventories were about 2% below the five-year average for this time of year, the EIA said. The larger-than-expected build is above Investing.com's estimate of a 1.7-mmbbl draw for the week.

RBC Capital Markets strategists said crude prices have been whipsawed by both sentiment around the Iran conflict and the reality on the water, noting that the headline-driven uncertainty has shifted market participation and price outcome.

On the supply front, the Organization of the Petroleum Exporting Countries on Wednesday slashed its global oil demand growth forecasts for the fourth straight month for 2026, projecting demand to grow by 600,000 barrels per day over the year.

The reduction is 200,000 b/d less than its July forecast of 800,000 b/d, already down from 1 million b/d in June, 1.2 mmbbl/d in May, and 1.4 mmbbl/d in April.

On Wednesday, the International Energy Agency also forecasted global demand to contract in 2026 by 1.6 million b/d, steeper than the about 1 million b/d drop seen last month.

The IEA said that global demand outlook is forecast to decline 510,000 b/d more than the agency's July estimate as the ongoing closure of the Strait of Hormuz and elevated fuel prices continue to weigh on oil consumption.

Meanwhile, President Trump said on Wednesday the US has "total control" of the Hormuz and expects to maintain control as Pakistan, the mediator between the two countries, reportedly said the deadline for a memorandum of understanding between Washington and Tehran could be extended.

"The USA has total control over the Strait of Hormuz. I think we will keep it! Our naval blockade is being called, by everyone, 'a wall of steel', and there is nothing Iran can do about it," Trump said in a Truth Social post.

Tensions around the Middle East energy chokepoints remain elevated on Aug. 11, though the number of confirmed crossings increased, with Hormuz recording 14 crossings, up 16.7% day on day, while Bab el-Mandeb traffic rose 14.3% to 40 crossings.

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$SHEL