A volatile mix of diplomatic breakdown, geopolitical tension, and stark warnings about depleting oil inventories sent crude prices sharply higher on Tuesday, with markets reacting to deepening uncertainty surrounding the U.S.-Iran standoff.
According to Ship & Bunker, Brent crude climbed more than 4.2% during mid-session trading to $94.98 per barrel — its largest single-day gain in nearly a month. West Texas Intermediate moved even more aggressively, rising over 5.5% to $92.16 per barrel, a move not seen since late April.
Stockpile Depletion Warnings Rattle Markets
The price surge followed increasingly alarming commentary from senior industry figures. Neil Chapman, a senior vice president at ExxonMobil, told delegates at a conference that global inventory levels are heading toward territory that has no modern precedent. As reported by Ship & Bunker, Chapman stated: “We’re approaching unheard-of inventory levels; I mean, really, really low levels… You can debate whether it’s going to hit those really low levels in two weeks or three weeks, but once you get to that point, then you’ll see price shoot up.”
Helima Croft, head of global commodity strategy at RBC Capital Markets, captured the broader mood in markets, telling Ship & Bunker: “There has been quiet panic building.”
Diplomatic Chaos Fuels Uncertainty
The instability in peace negotiations between the U.S. and Iran continued to drive sentiment. U.S. Secretary of State Marco Rubio reportedly told lawmakers that internal division within the Iranian regime is responsible for the erratic progress of talks. Adding to the confusion, Iran’s president reportedly submitted his resignation over the weekend, sparking speculation about regime stability.
A reported phone call between U.S. President Donald Trump and Israeli Prime Minister Benjamin Netanyahu added another layer of drama to the situation. The call, according to Ship & Bunker, came after Iran threatened to abandon peace talks in response to Israeli actions in Lebanon.
The resulting climate of conflicting headlines and shifting signals was summed up by Daan Struyven, co-head of global commodities research at Goldman Sachs. Speaking to Bloomberg TV, as cited by Ship & Bunker, he said: “Clients are tired… It’s a challenging trading environment with headlines moving prices up and down, and positioning in oil markets is significantly more limited than at the start.”
Regional Supply Shifts in Focus
Elsewhere in the oil market, a BMI report — a unit of Fitch Solutions — projected that most Middle Eastern oil producers will increase crude output by double-digit percentages next year as the region recovers from the impact of war and the Hormuz closure. Iraq, the first country to cut output amid shipping disruptions, is expected to see the largest rebound, with a projected increase of 34.1%, according to Ship & Bunker.
Separately, vessel-loading data reviewed by media and cited by Ship & Bunker indicated that Venezuela exported an estimated 1.25 million barrels per day of oil in May — a 61% jump compared to the same month in 2025. The rise follows the U.S. taking control over Venezuela’s oil sales earlier this year.
Does This Matter to You?
With the Strait of Hormuz remaining a critical flashpoint and global fuel inventories reportedly heading toward historically low levels within weeks, the pressure on fuel supply chains is intensifying. The sharp intraday price moves and warnings from senior figures at institutions like ExxonMobil and Goldman Sachs point to a market operating with reduced confidence and limited positioning room. For those managing fuel costs, supply planning, or risk exposure in international shipping routes, the combination of geopolitical unpredictability and tightening inventories represents a rapidly evolving situation that warrants close attention.
Gulf Bunkering does not provide operational or security guidance. This article is for informational purposes only. Operators should consult flag state authorities, P&I clubs, and relevant advisories for decisions relating to transit planning.
Sources: Ship & Bunker
