Oil Prices Open Lower
Crude oil prices opened sharply lower on Monday after WTI closed above $100 a barrel on Friday. WTI opened around $96.75, putting the market under renewed pressure as signs of improving shipping activity through the Strait of Hormuz raised expectations that some supply disruptions could ease.
WTI Futures Daily Chart – Opening Below $100
If traffic through the strategic waterway continues to recover and geopolitical risks moderate, WTI could face further downside toward the $90 level.
Hormuz Traffic Reaches Six-Month High
U.S. Central Command chief Admiral Brad Cooper said oil, LNG and cargo shipments through the Strait of Hormuz reached their highest level in six months over the past two weeks. He attributed the improvement to U.S. naval protection, coordination with Gulf producers and shipping companies, and mine-clearance operations. The primary transit lanes are now reportedly clear of mines.
More than one billion barrels of crude have moved through the waterway over the past couple of months, according to Cooper. However, Iran continues to maintain that the strait is closed, leaving significant uncertainty over how sustainable the recovery in shipping volumes will be.
Saudi Arabia Keeps Supply Risks Elevated
The broader regional security situation remains fragile. Saudi Arabia reported a missile attack targeting Riyadh on September 19, while smoke and flames were seen near King Khalid International Airport. Houthi forces claimed responsibility for attacks targeting locations in the capital and other Saudi areas, although details of damage remain disputed.
These developments could continue to limit how quickly the oil market unwinds its geopolitical premium.
China Adds Another Bearish Factor
China could provide another source of downward pressure on crude prices. The U.S. Energy Information Administration estimates China’s strategic oil inventories reached about 1.4 billion barrels by December 2025, while its estimated total strategic inventories remained around 1.49 billion barrels in the second quarter of 2026.
At the same time, China’s crude imports fell 32% quarter-on-quarter to 8.1 million barrels per day in Q2 2026 as higher prices and disrupted Hormuz flows reduced purchases.
With Hormuz traffic recovering and Chinese demand softer, crude prices could remain vulnerable. A sustained improvement in shipping conditions would increase the risk of WTI sliding toward $90.
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