Oil Has Been Here Before: Brent Hits $104 After a Q2 That Erased 38%
The Hormuz disruption driving crude above $100 is the same conflict that was already live when oil fell sharply through the second quarter of 2026.
ICE Brent crude front-month was quoted at $104.32 a barrel as of 2026-09-12, holding levels built in the weeks since the United States launched strikes on Iran's Larak Island near the Strait of Hormuz on Monday (2026-08-31). Tehran's warning of retaliation added to supply concerns over a waterway that carries approximately 20 million barrels of crude and petroleum products a day, about 20% of global petroleum liquids consumption according to EIA data.5,4
Oil prices remained above $100 on Thursday (2026-09-03) as markets priced a possible prolonged supply disruption. JPMorgan estimates that each additional month of Hormuz disruption could add roughly $7 to $8 a barrel to Brent, and under a three-month scenario the bank expects average monthly prices near $114 a barrel. Tim Waterer, chief market analyst at KCM Trade, told Reuters the moves reflect a combination of physical supply tightness and a geopolitical premium. Ship traffic through the strait had fallen to just four vessels a day by early September.7,6
But the same conflict was already well established when ICE Brent front-month lost approximately 38% during the second quarter of 2026 and NYMEX WTI front-month shed around 29%. By Tuesday (2026-06-30), Brent's expiring August contract had fallen to $73.31 a barrel, the active September contract was trading at $74.36, and WTI for August delivery changed hands at $71.12.3
The Q2 selloff shows the market had already priced out the conflict once before and did so fast. On Tuesday (2026-05-05), oil fell around 3% in a single session after shipping activity briefly resumed in the Strait of Hormuz and the United States confirmed a ceasefire remained active despite ongoing exchanges of fire.2 Physical disruption was present. An active war was present. Prices still collapsed.
US crude inventory levels add context the headline price does not fully capture. EIA data showed American crude stockpiles at 424.5 million barrels as of Friday (2026-08-28), down 4.45 million barrels week-on-week, more than four times the 1.1 million-barrel drawdown the market had expected.6 The draw is large. Yet 424.5 million barrels is a substantial stock. Moving it toward genuine stress levels would require persistent, prolonged supply interruption, not episodic flare-ups.
The mid-May price action makes a similar point. Brent futures gained just 81 cents on Thursday (2026-05-21), less than 0.8%, to $105.83 a barrel, while WTI advanced 97 cents to $99.23, on a session that combined a meaningful inventory drawdown with what was reported as persistent Iran-related supply concerns.1 A significant draw and an active conflict produced a sub-1% daily move. By that point, the market had done most of its pricing work.
Brent also recorded its third straight monthly loss in June (2026-06-30), shedding approximately 20% in the month alone, while WTI posted its second consecutive monthly decline at roughly 19%. Both moves occurred with no diplomatic resolution in sight.3
JPMorgan's $114 scenario holds on its own logic. Three months of strait disruption at current severity, with no diplomatic off-ramp, would justify pricing at that level. But the May ceasefire episode and the Q2 collapse both show the market does not wait for a resolution to sell. It sells on the expectation of one.7,2
NYMEX WTI front-month was quoted at $99.99 a barrel as of 2026-09-12. Vessel transit data through the Strait of Hormuz is what drove the May selloff, not a formal agreement. If ship counts recover from four-per-day toward a double-digit daily flow, the precedent from Tuesday (2026-05-05) suggests prices will move well before any diplomatic announcement follows.2,6