Traffic remains low through Strait of Hormuz
August 18, 2026
Energy prices rallied again in yesterday’s trading pushed higher by the news that the Strait of Hormuz oil traffic is very low and the news of Iran attacking 2 UAE ships last week. The market is also supported by the US’s comments that they can maintain a naval blockade of Iran indefinitely and no real progress on talks to end the war. The US said they have no interest to extend the memorandum of understating and then Iran said they will just wait Trump out and deal with the next President. This is not good news for lower energy prices.
The Department of Energy said stocks of crude oil in the US Strategic Petroleum Reserve fell by about 5.3 million barrels last week to the lowest level since December 1982.
The EIA reported that US Gulf Coast to West Coast waterborne crude oil and petroleum products shipments more than quadrupled year on year in April and May after the Jones Act waiver. It said the shipments reached a record 1.2 million bpd in April up 11% from pre-waiver record. It said crude oil shipments from the Gulf Coast to the East Coast increased to a record 180,000 bpd in May.
US Energy Secretary, Chris Wright said he would like to talk to US refiners on Monday about ways to increase fuel prodctuion in an effort to lower gasoline prices that remain high in the wake of the US-Israeli war on Iran. He said increasing refinery output in the US and elsewhere was the key to lowering gasoline prices. According to AAA, the average US price for regular gasoline is more than $4.06 per gallon, up by more than $1 from a year ago.
Crude oil tanker rates have climbed by more than 50% since the start of July in response to the breakdown of the ceasefire between the US and Iran and an upsurge of attacks on shipping in the Strait of Hormuz and the Red Sea.