Market Report Week 17 - 21.04.2026

Oil market update: Tense situation

It has once again been a dramatic week in the oil market – and developments have been particularly dramatic over the past few days. 
Iran announced on Friday an opening of the Strait – albeit with a number of restrictions, including where vessels were allowed to sail. However, this did not lead the US to lift its blockade of Iranian oil exports.
The market reacted to Friday’s sudden announcement by sending Brent down from around USD 98 to a low of USD 86. Oil prices subsequently ticked higher again as the market took a closer look at what Iran had actually communicated. It became clear that the message on X did not imply a full reopening. Hence, the Brent front contract closed at USD 92 on Friday and is currently trading at USD 95.  
The tweet read as follows:

"In line with the ceasefire in Lebanon, the passage for all commercial vessels through Strait of Hormuz is declared completely open for the remaining period of ceasefire, on the coordinated route as already announced by Ports and Maritime Organisation of the Islamic Rep. of Iran."

In other words, a reopening of the Strait – but a highly controlled one. It appeared that the US and Trump saw through the announcement, and it was stated that the blockade of Iranian oil would be maintained.
It took only until Saturday morning for the Revolutionary Guard to announce that the Strait was once again closed due to the continued US blockade. And to underline that the closure was serious, live fire was directed at several vessels from patrol boats. It is worth noting that the Revolutionary Guard closed the Strait, while Foreign Minister Araghchi had announced its reopening. This may be an early sign of internal divisions within Iran.

What will the oil market focus on in the coming week?

First, Trump has sent a delegation to Pakistan, which may include Vice President JD Vance, to continue negotiations with Iran. However, at the time of writing, it seems unclear if Iran will actually take part. Sunday evening, the Iranian news agency IRNA has stated that Iran will not participate in new negotiations with the Americans. The rejection came just hours after Trump announced that if Iran does not accept his terms, he will bomb all power plants and bridges across Iran. There is, therefore, a significant risk that the war could escalate again, though the rhetoric from Iran has been slightly more retaliatory over the last two days.  

This paints a different picture from the peace optimism that characterised the market on Friday.  

From the Iranian side, a closure of the Bab el-Mandeb by the Houthis appears to be a likely new escalation step, which would make it very difficult for Saudi Arabia to circumvent the Strait of Hormuz via the oil pipeline to Yanbu. New attacks on oil production, refineries, and LNG infrastructure in the Persian Gulf also appear likely.

Second, the 14-day deadline set by Trump to reach an agreement is approaching and will, according to Trump, run out Wednesday night US eastern time. Hence, Wednesday could become highly volatile if no agreement is reached.

Fourth, our assessment is that the market has so far pushed oil prices lower on the back of “peace/deal” statements from Trump. Now, however, the focus appears to be shifting towards the risk of escalation – a more balanced risk picture. It is worth remembering that the market went into last weekend expecting a peace deal – and a reopening of the Strait of Hormuz – to be close. That is no longer the case.

Finally, the market has been heavily driven by news flow. We expect this to remain the case in the coming week. One of the more overlooked developments to watch is Russian oil exports, which are coming under increasing pressure due to successful Ukrainian drone attacks on various ports in recent weeks.