According to ICE’s latest data, Tuesday saw approximately 764,000 Brent crude put options traded — a new record high. Will oil prices continue falling?

Similar record volumes occurred in March and April 2026, yet markets reversed sharply shortly thereafter. Thus, this week’s trading volume first signals extreme risk polarization, and only secondarily indicates directional bias. Currently, if conditions remain as the U.S. states — with 10 million barrels per day (bpd) of crude continuing to exit globally, Saudi crude flowing steadily, and a U.S.-Iran agreement appearing highly probable — then fundamentals do offer near-term downside potential. However, this is not yet a classic oversupply-driven bear market. The IEA projected in September that global oil demand would fall by 2.5 million bpd in 2026, while supply would decline by 5.7 million bpd; global output dropped to 100.1 million bpd in August, and global observable inventories fell by 95 million barrels month-on-month — down roughly 507 million barrels cumulatively since February. J.P. Morgan estimated on September 17 that Brent’s fair value stands around USD 90 per barrel; Bank of America’s latest forecast projects ~USD 95 at end-2026 and ~USD 80 in 2027, while warning that oil could still surge past USD 150 if supply deteriorates further. As for the sharp U.S. crude inventory build reported on September 18, I believe it reflects recent global oil intake combined with refinery shutdowns — making its sustainability questionable. Moreover, although U.S. data influences futures pricing, it does not dictate the global market! Hence, the USD 70 strike level embedded in those options resembles a ‘tail-risk and at-the-money’ reference — not today’s benchmark price. To reach that level, multiple conditions must converge: a fully implementable U.S.-Iran agreement; stable, restored operations through the Strait of Hormuz; Saudi Arabia’s East-West pipeline operating at maximum capacity; a marked decline in Houthi attacks; continued weakening of demand; and sustained, substantial inventory builds. Yet even under current conditions — with international oil markets permitting open shipping lanes — supply will not rebound instantly. Because, judging from yesterday’s speech by Iran’s president and the broader Middle East situation, the region is now operating on a ‘dual-track’ basis. On one hand, the U.S. and Iran held extended indirect talks during the UN General Assembly via intermediaries — but Iran’s Foreign Minister’s move drew public condemnation from IRGC-affiliated media. On the other, Iran has stated it could reopen the Strait of Hormuz within one week if the U.S. eases military pressure and lifts port blockades; Qatar and Oman are actively promoting regional security arrangements. Yet the IRGC insists the Strait cannot reopen unless Iran’s demands are met. Meanwhile, Trump has signaled the agreement may be delayed until after the November midterm elections — or even that military escalation could continue. Iranian President Pezeshkian, speaking at the UNGA on September 23, emphasized Iran would not surrender — causing Brent to rebound to USD 103.08 that day, indicating markets are pricing in the *possibility* of negotiations, not the *certainty* of peace. Today’s sharp oil price drop, however, suggests major intervention in dominant positions — revealing structural confusion among market participants. Even more critically, the Houthi–Saudi front continues escalating. The Houthis persist in attacking Saudi cities and energy infrastructure, while tightening control along the Red Sea coast!

Diplomatic mediation between Iran and Oman shows early success, and Strait of Hormuz shipping volumes have quietly rebounded to 75% of pre-war levels.

Oil flows through the Strait of Hormuz are quietly rebounding, and the optimism generated by diplomatic mediation is eroding the war-risk premium previously embedded in oil prices. Brent crude futures dipped to an intraday low of USD 86.22 per barrel on Thursday before recovering above USD 88 — marking a 6.3% weekly decline. Reports indicate Kuwait and Qatar have resumed crude exports via this critical maritime chokepoint; total daily oil throughput via the Strait has rebounded to roughly 75% of pre-war levels, significantly easing market concerns over supply disruptions. Meanwhile, according to CCTV News, a senior Iranian official stated on the 26th that Iran and Oman “remain engaged in detailed negotiations” regarding the Strait of Hormuz agreement. Earlier this month, Iran had indicated the deal was nearing finalization. This development marks a notable reversal from late April, when Brent surged above USD 120 per barrel — yet analysts caution that core disagreements between the U.S. and Iran remain unresolved, and the energy crisis has now spread from crude supply into the refined products market, where diesel crack spreads remain at historic highs. Rapid transport recovery confirmed by multiple data sources According to Bloomberg, citing Gulf-region energy flow insiders, Kuwait and Qatar’s current combined crude export volumes stand at about 70% of their pre-war average of 2 million bpd. Overall, tanker-borne oil throughput via the Strait of Hormuz has climbed to 7–8 million bpd — up sharply from ~4 million bpd in mid-July — equivalent to roughly 75% of pre-war levels. London-based energy and shipping analytics firm Vortexa offered a more optimistic figure in an independent client report, stating the seven-day average throughput via the Strait has approached 10 million bpd. Shipping research firm TankerTrackers was the first to disclose rising ship-to-ship (STS) transfer activity on Tuesday. In a social media post, the firm reported at least 15 simultaneous STS operations underway in the Gulf of Oman that day — involving approximately 25 million barrels of crude and some refined products — with origins spanning virtually every regional country except Iran.

Oil Declines as Traders Parse Signs of Fresh Diplomacy on Iran

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Oil prices dropped as traders weighed diplomatic efforts to avert US strikes on Iran, with WTI near $102 and Brent near $115. The volatility impacts inflation concerns and consumer pressure amidst ongoing geopolitical tensions.

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Oil Declines as Traders Parse Signs of Fresh Diplomacy on Iran

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