WTI Whipsaws as Hormuz Hopes Collide With Diesel Crunch

November WTI crude futures spent the week oscillating between hopes of a diplomatic reopening of the Strait of Hormuz and the reality that shipping conditions had yet to return to normal. Reports early in the week that Iran might reopen the Strait within seven days pushed the contract down to $88.67 on Tuesday as traders reduced risk premia. Later in the week, gains evaporated when it became clear there was no firm agreement and that tanker traffic had not resumed normal patterns, lifting the contract back toward the mid-$90s. By 22:00 GMT on Thursday, November WTI was trading at $94.76, a decline of $0.71 or 0.74% over the week, after touching a high of $96.78 earlier that day. The pattern of a sharp midweek low followed by a rebound but failure to reclaim a sustained rally illustrates the market’s sensitivity to both diplomatic signals and observable shipping activity: traders pared risk when Saudi barrels began moving and Iran floated a deal, then reintroduced premium once it was clear workarounds were not equivalent to open shipping lanes. Physical flows from the Gulf provided a contradictory backdrop. Saudi Aramco increased shipments through the Strait of Hormuz after attacks that damaged its East-West Pipeline and curtailed some Red Sea loadings. Tanker-tracking data referenced in the report showed roughly 14 million barrels loaded on seven very large crude carriers (VLCCs) inside the Gulf, and Saudi flows through the Strait rose sharply from August levels. The East-West Pipeline’s restart offered an additional export route, though it was described as not yet a full return to pre-disruption capacity. The interplay between diplomatic reports, observable tanker movements, and alternative export routes underpinned the week’s trading: incremental increases in physical flows removed some immediate scarcity concerns, but the absence of confirmed, sustained reopening of key shipping lanes left the market balancing on uncertain information rather than clear, durable supply changes.