Oil Eases as Hormuz Shipping Concerns Moderate; Prices Still Head for Strong Monthly Gain

Oil prices fell on Friday as shipping activity through the Strait of Hormuz showed signs of improvement, although crude remained on track for a strong monthly gain supported by ongoing geopolitical risks.

Brent crude slipped 1.6% to $87.62 per barrel, while U.S. West Texas Intermediate (WTI) declined 2.0% to $81.85. Despite Friday's losses, both benchmarks remained significantly higher for July.

Ship-tracking data indicated a modest increase in tanker movements through the Strait of Hormuz. ING said the data may not fully capture actual shipping activity because some vessels can disable tracking systems.

Meanwhile, investors continued monitoring geopolitical developments after recent attacks affecting energy infrastructure in the Middle East. U.S. Energy Information Administration (EIA) data also showed commercial crude inventories fell by 7.2 million barrels in the week ended July 24, reaching their lowest level since 2018.

Market participants will continue monitoring developments in the Middle East, shipping conditions, and inventory data for further supply signals.

Sources: Reuters, ING, U.S. Energy Information Administration.