Brent crude prices remain volatile below recent peaks as Strait of Hormuz traffic declines, the ECB meeting account shows.
The European Central Bank highlighted ongoing disruptions in global oil supply chains due to Middle East conflicts, noting persistent volatility in Brent crude prices. Traffic through the Strait of Hormuz, a critical chokepoint, has fallen below historical norms despite a temporary rebound, the July meeting account revealed.
Oil prices briefly retreated to pre-war levels after a preliminary peace deal but rebounded, staying below mid-June peaks. Longer-dated futures remained elevated, reflecting sustained supply concerns despite short-term price swings. The ECB noted the futures curve had shifted downward since June but stayed above pre-conflict levels.
Geopolitical risks and AI-related developments continued to drive market sentiment, according to the account. The ECB’s observations underscore the fragility of energy markets amid unresolved regional tensions.