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Diplomatic friction and institutional supply modeling stabilized Brent near $80Brent crude rebounded near $80 as US warnings to Israel exposed the fragility of the US-Iran ceasefire, while institutional restart models clashed with a forecasted 4.9% collapse in Chinese demand. |
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Crude benchmarks split Thursday, with Brent rebounded from multi-month lows as diplomatic friction tested the US-Iran ceasefire.
Brent advanced 30 cents (0.38%) to $79.85, while US WTI slipped 19 cents (0.25%) to $76.60.
The prompt recovery followed US warnings against Israeli operations in Lebanon, exposing vulnerabilities in a 14-point memorandum binding regional allies to de-escalation protocols.
Forward curves are actively recalibrating against complex physical restart timelines. The interim agreement mandates full restoration of Strait of Hormuz maritime capacity within 30 days.
Aligning with this framework, Goldman Sachs models an immediate 13-million-barrel-per-day export influx, projecting complete Gulf export normalisation by late July. Accounting for the severe 100-day commercial stockpile depletion, BNP Paribas established a durable $75 per barrel structural floor to accommodate global inventory replenishment.
Macroeconomic headwinds continue to cap spot upside. PetroChina officially forecast a 4.9% contraction in 2026 domestic oil consumption to 753 million metric tons amid elevated energy costs and an accelerated alternative pivot. This acute Chinese demand destruction offset localised supply bullishness from a second Ukrainian drone strike on a Moscow refinery, keeping benchmark gains strictly range-bound.
Written by: Aiman Haikal
