Oil markets closed July 2026 on a cautious note, with ICE Brent crude on track for an 8% weekly loss yet finding a floor near $90 per barrel as ongoing disruptions across two critical Middle Eastern waterways continued to underpin prices, according to a report published by OilPrice.com on July 31, 2026. The week's sell-off was arrested by the reality of simultaneous disruptions in the Strait of Hormuz and the Red Sea. Iran's Islamic Revolutionary Guard Corps claimed to have turned around several tankers attempting to transit the Strait of Hormuz, though analysts noted this may also signal that shippers are not prepared to abandon the route entirely.
With Tehran having rejected Oman's proposal for joint regional management of the Strait and no new U.S.-Iran diplomatic talks on the horizon, market participants see little near-term resolution to the shipping crisis. In a significant geopolitical development, Saudi Arabia announced the formation of an international maritime coalition to protect Red Sea shipping lanes from Houthi attacks. According to Reuters, Riyadh will serve as the founding and leading state of the alliance, which has attracted 13 other member countries, and will host the coalition's new headquarters.
The initiative underscores Riyadh's growing concern over the vulnerability of regional energy supply chains. Meanwhile, BP formally launched a process to sell its UK North Sea oil and gas business, which produces approximately 115,000 barrels per day. The British oil major cited high taxes and a deteriorating investment climate as the primary drivers behind what amounts to a historic withdrawal from a basin where it has operated for more than six decades.
A drone attack on Egypt's Damietta port caused a fire aboard two gas vessels, including the Energos Winter floating storage and regasification unit, one of only three operational LNG import terminals in the country. Egypt had already received 1.5 million tonnes of LNG at the facility so far in 2026. The Caspian Pipeline Consortium suspended oil loadings at its Black Sea export terminal following fresh drone strikes on incoming tankers.
Suppliers of Kazakh crude are reportedly considering an indefinite halt to loadings pending safety guarantees. In Europe, critically low water levels on Germany's Rhine River disrupted inland fuel transportation, with the key Kaub chokepoint falling to just 25 centimetres, driving freight rates to multi-year highs and constraining fuel flows from Northwest Europe, according to Bloomberg. On the supply diversification front, South Korean refiners are evaluating imports of Venezuelan crude for the first time in years as Middle East disruptions prompt a search for alternative feedstocks, according to Reuters.
Venezuelan exports to the United States reached a record high of 715,000 barrels per day in July. In Iraq, BP agreed to sell a 15% stake in its Kirkuk venture to Turkey's state-owned TPAO, strengthening regional support for the rehabilitation of northern Iraq's giant oil and gas fields. The deal also paved the way for a negotiated 12-month extension of the Kirkuk-Ceyhan pipeline transit agreement, despite the expiry of the bilateral treaty.
In a milestone for China's energy transition, the country generated less than half of its electricity from coal in the first half of 2026, with coal's share falling to 49.7% while renewable energy surpassed 40% of the power mix, driven by rapid expansion in wind and solar capacity. Portugal approved a draft solidarity tax that would impose a 33% levy on excess profits earned by oil companies in 2026. The measure came as domestic energy firm Galp reported a net profit of $0.6 billion in the second quarter.
A QatarEnergy-owned LNG carrier, the Al Areesh, exited the Strait of Hormuz for the first time in nearly three weeks, moving to Pakistan after Islamabad lobbied Tehran to ease energy shortages that had been compounded by a coal mine explosion. Russia extended its diesel export ban for another month through end-August to contain soaring domestic fuel prices amid ongoing Ukrainian drone strikes on energy infrastructure. July diesel outflows totalled only 150,000 barrels per day, though officials indicated restrictions could be lifted earlier if conditions improve.
Shell's decision to sell its 35% stake in Cyprus' Aphrodite gas field to Hungary's MOL for $720 million triggered frustration among Cypriot government officials, who criticized the oil major's handling of the process ahead of a long-awaited final investment decision on the project.
Source: oilprice.com