US-Israel-Iran War Live News: The war in the Middle East has caused prolonged disruption around the Strait of Hormuz and is putting fresh pressure on global oil markets as hopes of a quick return to normal shipping weaken. The US Energy Information Administration (EIA) has raised its 2026 Brent crude price forecast to $86.81 a barrel, while shipping traffic through the strategic waterway has fallen to its lowest level in a week.Â
Reuters reported that only 8 vessels crossed the Strait of Hormuz on Tuesday, according to Kpler data, compared with a 10-day average of about 12. LSEG data showed 11 transits, down from 14 a day earlier.Â
US-Israel-Iran War Live News: EIA Raises 2026 Brent Oil Price Forecast to $86.81
The EIA has significantly increased its outlook for oil prices as the conflict continues to disrupt production and shipping in the Middle East.
The agency now expects Brent crude to average $86.81 per barrel in 2026, up from its previous forecast of $81.91. It also raised its 2026 average forecast for WTI crude to $80.88 per barrel, compared with $76.26 previously.
The EIA expects prices to ease in 2027, forecasting average Brent at $69.39 per barrel and WTI at $65.39 per barrel.
The agency’s latest outlook reflects the prolonged impact of the conflict on regional oil production and maritime trade. Reuters reported that around 5.5 million barrels per day, or more than 5% of global oil consumption, remained shut in during July because of disruptions linked to the conflict.
US-Israel-Iran War Live News: Strait of Hormuz Shipping Traffic Falls to One-Week Low
Commercial traffic through the Strait of Hormuz has dropped sharply as shipowners continue to avoid the waterway. Kpler data cited by Reuters showed that eight vessels transited the strait on Tuesday, below the 10-day average of around 12. It marked the lowest daily traffic level since August 5.
LSEG recorded slightly higher activity, with 11 vessels crossing on Tuesday compared with 14 on Monday.
The decline remains dramatic compared with pre-war traffic. Before Iran closed the waterway following the start of US-Israeli attacks on February 28, around 130 to 140 vessels typically crossed the Strait of Hormuz each day.
US-Israel-Iran War Live News: Why Is the Strait of Hormuz So Important for Oil?
The Strait of Hormuz serves as a critical gateway between the Persian Gulf and the Gulf of Oman. Major oil-producing countries in the region depend on the waterway to move crude and petroleum products to international markets.
Any sustained disruption therefore creates concerns about global supplies, freight costs and insurance premiums.
The EIA has already warned that prolonged disruptions can keep oil prices elevated. Its latest forecast reflects the possibility that some Middle Eastern production will remain offline even after shipping conditions improve.
Reuters reported that the agency expects about 600,000 barrels per day of regional oil production to remain shut through 2027.
US-Israel-Iran War Live News: Oil Prices Rise as US-Iran Peace Hopes Fade
Oil prices have also responded to growing uncertainty over a possible US-Iran agreement. Reuters reported that oil prices rose on Wednesday as doubts about a peace deal increased concerns about continued supply disruptions. The market has also reacted to attacks on commercial vessels in the region.
Brent crude and other international benchmarks have remained sensitive to developments around the Strait of Hormuz because traders cannot yet determine when normal shipping will resume.
On Tuesday, Reuters reported that Iran continued to insist that the waterway would remain closed unless the United States accepted Tehran’s conditions. That uncertainty has made it harder for energy markets to price in a rapid return of supplies.
US-Israel-Iran War Live News: Ships Continue to Avoid Strait of Hormuz
The latest vessel numbers indicate that shipping companies remain cautious despite some vessels continuing to use the route.
Of the eight vessels tracked by Kpler on Tuesday, only one coal carrier exited the strait. Seven others entered through Iranian waters and continued their journeys.
The increase in traffic through the Bab el-Mandeb Strait provides another indication that some operators may be adjusting routes. Reuters reported 30 transits through Bab el-Mandeb on Tuesday, above its 10-day average of 25.
However, alternative routes can add significant time and cost to voyages, especially for vessels travelling between the Middle East, Europe and Asia.
US-Israel-Iran War Live News: Four Drones Reportedly Crash in Iraq’s Erbil Province
The regional conflict has also continued to affect Iraq’s Kurdistan Region. Reports from Kurdish outlet Rudaw have described continuing drone activity around Erbil province. Earlier attacks have targeted Iranian Kurdish opposition groups and areas around military facilities.
Rudaw previously reported that drones had fallen across areas including Soran and Harir, while Harir also hosts a US military air base. In one earlier incident, three drones were intercepted in the Harir area, while several others crashed in the Soran administration.
The latest reports of four drones crashing across Soran, Khalifan and Harir come against this wider backdrop of repeated Iranian drone and missile activity in the Kurdistan Region.
US-Israel-Iran War Live News: Iran’s Strikes Increase Regional Security Risks
Iranian missile and drone activity in Iraq has become another major concern as the wider US-Iran conflict continues.
Rudaw has previously reported repeated attacks across Erbil province, including strikes near Iranian Kurdish opposition bases. In July, the outlet reported that four drones hit bases belonging to Iranian Kurdish opposition groups east of Erbil, with no casualties reported.
The repeated attacks show how the conflict has extended beyond Iran’s borders and into neighbouring countries.
For the United States, the presence of military personnel and facilities in Iraq creates an additional security concern. For Iraq’s Kurdistan Region, repeated drone activity raises risks for civilians as well as military and energy infrastructure.
US-Israel-Iran War Live News: War Raises Fresh Oil Supply Concerns
The combination of low shipping traffic and continued military activity has increased uncertainty for the global energy market.
The Strait of Hormuz remains the most immediate concern because the waterway carries a significant share of global oil and gas shipments. Even when vessels continue to cross, sharply lower traffic indicates that many operators still consider the route too risky.
The EIA’s higher price forecast reflects this uncertainty. Its latest assessment also suggests that the impact of the conflict could last well beyond the immediate disruption, with some regional production expected to remain offline into 2027.
US-Israel-Iran War Live News: What Happens Next for Oil Prices?
The direction of oil prices will depend heavily on three factors: the security situation around the Strait of Hormuz, the pace at which regional oil production returns and progress towards a US-Iran agreement.
A sustained reopening of the waterway could ease supply concerns and push prices lower. However, renewed attacks on commercial vessels or energy infrastructure could trigger another jump in crude prices.
The latest EIA forecast shows that the disruption has already changed expectations for the oil market. At the same time, the latest Hormuz traffic data indicates that shipping companies have not yet returned to normal operations.Â
