US-Iran Attack Pause Drives Brent Through Two-Day, Near-9% Retreat
Two days without Persian Gulf strikes pulled ICE Brent's September contract down 4.9% on Sunday (2026-07-26), extending Friday's (2026-07-24) 3.9% decline before a partial Monday recovery.
ICE Brent crude's September contract fell 4.9% to $92.02 in early trading on Sunday (2026-07-26), after the United States and Iran went a second straight day without launching military strikes in the Persian Gulf, AP reported.6 The move added to a 3.9% drop on Friday (2026-07-24), pulling the benchmark off a two-month high set during the week of July 13 (2026-07-13).6
Two sessions together stripped roughly eight-and-a-half percentage points from ICE Brent crude front-month. NYMEX WTI's September contract fell 5.6% to $84.34 on Sunday (2026-07-26), having already shed 3.1% on Friday (2026-07-24).6 ICE Brent's October contract, now the most actively traded part of the forward curve, dropped 4.6% to $87.48.6
By early Monday (2026-07-27), ICE Brent crude front-month had recovered to $91.60, up 4.66% in thin Asian session trade. [live prices] NYMEX WTI was broadly flat at $84.52, down 0.33%. [live prices] The durability of that recovery depends on whether European and U.S. trading desks confirm it once they open.
The ceasefire-optimism pattern in this conflict has played out before. In late May, ICE Brent crude front-month was on track for a 19% monthly decline (the steepest since 2020) as traders bet on an extended ceasefire and a broader U.S.-Iran deal, with front-month futures around $93.84 on Friday (2026-05-29), OilPrice.com reported.1 That move priced in a diplomatic outcome that failed to hold.
When U.S. President Donald Trump called off a strike on Iran on Thursday (2026-06-11) and claimed a deal had been reached, ICE Brent crude front-month fell further. By Friday morning (2026-06-12), it was down 4.34% at $86.36 in European trade, with WTI off 4.47% at $83.88, OilPrice.com reported.3 The interim peace agreement formally signed by Washington and Tehran on Thursday (2026-06-11) reopened tanker passage through the Strait of Hormuz, and ICE Brent crude front-month closed at $79.03 that Friday (2026-06-12), a 9.5% weekly decline, CryptoBriefing reported.5,4
Prices then rebuilt substantially above those late-June lows. The recovery to a two-month high during the week of July 13 (2026-07-13) suggests the interim agreement did not hold or that hostilities resumed, and traders read Sunday's (2026-07-26) pause as another de-escalation move rather than a durable settlement.6
OPEC output data adds a supply dimension. Group production fell 177,000 barrels a day month-on-month in May to 18.8 million barrels a day, per OPEC's monthly market report cited by The Hindu BusinessLine.2 Iran saw the sharpest individual decline, dropping 546,000 barrels a day as the U.S. blockade squeezed its oil industry.2 Any sustained ceasefire would ease that pressure and return Iranian barrels to market.
Traders are also watching U.S. monetary policy. CME data cited by AP on Sunday (2026-07-26) showed a 36% implied probability that the Federal Reserve will raise its main interest rate at an upcoming meeting.6 A hike would strengthen the dollar and add a macro headwind to crude demand, limiting how far any peace dividend can translate into a durable price floor.
ICE Brent's October contract closed Sunday (2026-07-26) at $87.48, pricing in a near-term supply premium over September's $92.02 — a gap that narrows sharply if the ceasefire holds.6 A third consecutive day without Persian Gulf strikes is the next test of whether markets are willing to close it.