Brent rebounds 0.5% to $105.25 after reports of US strikes near Hormuz

Key Facts

Brent crude rose 0.5% to $105.25 a barrel, while West Texas Intermediate gained 0.5% to $96.93, at 0104 GMT on Nov. 3, according to Reuters. The rebound in Asian trading followed a report of US strikes on Iranian targets in the Strait of Hormuz. A US official told The Associated Press the strikes targeted Iranians using surface-to-air missiles against US assets. Officials described the strikes as defensive, to prevent Iran from targeting commercial vessels, Reuters reported. Iranian television reported hearing explosions on Qeshm Island, but The Associated Press report did not confirm that the island itself was a target of the strikes.

Oil moved higher after a sharp drop in the previous session; Brent settled on Monday, Nov. 2, at $104.77 a barrel, down $8.66, or 7.63%. Reuters said the strikes heightened concerns about an expansion of the conflict, now in its 8th month, and the possibility of continued disruption to oil supplies from the Middle East. Reuters had attributed the earlier decline to Monday's trading, while prices rose in early trading on Tuesday after the report of the strikes. The two-day move shows a contrast between the previous session's losses and the subsequent rebound. Reuters did not attribute the earlier decline to the strikes it reported the following day.

The significance of developments in the Strait of Hormuz lies in its role in global energy flows. Reuters said the passage carried about one-fifth of the world's crude oil and natural gas supplies before the conflict, and that transit traffic has fallen sharply because of the conflict. The US Energy Information Administration estimated that oil flows through the strait reached about 20 million barrels a day in 2024, equivalent to nearly 20% of global petroleum liquids consumption. That volume underscores the market's sensitivity to any disruption to shipping or transit supplies. The administration estimated that Saudi Arabia and the United Arab Emirates had about 2.6 million barrels a day of available pipeline capacity to bypass the strait if supplies were disrupted. It said these pipelines do not typically operate at full capacity.

The escalation coincided with continued political contacts, with the negotiating track remaining open, according to reported statements. US Vice President JD Vance said the president and his team see "good chances of reaching a potential negotiated settlement," adding: "We will continue working on that." Reuters reported that contacts between Iran and the United States to end the war are continuing. This followed Iranian talks with Qatari mediators that ended with revised proposals but no breakthrough. The Associated Press reported that the October attacks on commercial vessels in the Strait of Hormuz were the most numerous since March. The agency said Iran is seeking to increase economic pressure on the United States.

Qatari mediators held two rounds of talks with Iranian officials during the previous week, The Associated Press reported. The talks addressed a framework to halt attacks on the strait in exchange for the United States lifting its blockade of Iranian ports. The agency said further rounds were scheduled for this week. The US Energy Information Administration is scheduled to release its weekly petroleum report for data through Nov. 6 on Thursday, Nov. 12, 2026, at 12 p.m. Eastern time. The release was delayed because of the Veterans Day holiday. OPEC set Nov. 29, 2026, as the date of the next ministerial meeting of countries participating in the Declaration of Cooperation.