August 25, 2026: Oil prices recovered slightly on Tuesday after falling more than 2% in the previous session. Investors are assessing the impact of new US sanctions against Iran and the potential effect on global crude supplies.

Brent crude futures rose 27 cents, or 0.3%, to $92.44 a barrel. US West Texas Intermediate (WTI) crude gained 37 cents, or 0.4%, to $85.38.

Both benchmarks settled lower on Monday. US crude fell to a one-week low as traders took profits following a strong rally over the previous two weeks.

Markets Take New Iran Sanctions in Stride

The latest US measures have so far failed to trigger a major jump in oil prices. Analysts said traders appear to view the sanctions as less disruptive than direct military action.

ING commodity strategists said markets were largely unfazed by Washington’s latest efforts to tighten economic pressure on Iran.

US Treasury Secretary Scott Bessent announced an expansion of sanctions on Monday. The measures are aimed at cutting off Iran’s economic lifeline and increasing pressure to end the conflict.

Bessent said countries would need to reduce their business ties with Iran. Those that fail to comply could face exclusion from the dollar-based financial system.

The Treasury secretary did not identify the countries that could face penalties. He also did not provide a specific date for enforcement.

Strait of Hormuz Remains Key Risk

The United States has not ruled out military action against Iran. However, Washington is currently placing greater emphasis on economic pressure.

Analysts said the shift has reduced immediate concerns about a major disruption to Middle Eastern oil supplies.

Tim Waterer, chief market analyst at KCM, said markets were treating economic pressure as a lower-risk option for physical oil supplies.

However, he warned that Iran could still disrupt shipping. That possibility continues to add a risk premium to crude prices.

An oil tanker was struck by an unidentified projectile on Tuesday. The vessel was disabled about nine nautical miles northeast of Oman’s Ash Shishah, according to the United Kingdom Maritime Trade Operations.

The incident has renewed concerns about shipping security in the region.

Iran War Leaves Netanyahu Facing a Strategic Dilemma as Israel Weighs What Comes Next

Iran Maintains Pressure on Hormuz

Iran continues to assert control over the strategic Strait of Hormuz.

Before the conflict began in February, the waterway carried cargoes equivalent to roughly 20% of global oil consumption.

Iran named 45 tankers on Monday that it said had violated its rules for crossing the strait. Tehran also warned that it could take action against the vessels, including confiscating their cargoes.

Any sustained disruption in the waterway could have major consequences for global energy markets.

US Oil Reserves Reach Lowest Level in Decades

The conflict has already forced countries to use commercial and strategic oil reserves.

The US Department of Energy reported that crude stocks in the Strategic Petroleum Reserve fell by around 3.7 million barrels last week.

The reserve stood at approximately 289.7 million barrels. That was its lowest level since November 1982.

The decline highlights the pressure that prolonged supply disruptions could place on energy security.

For now, oil markets remain focused on the balance between economic sanctions and physical supply risks. Any escalation around shipping routes or the Strait of Hormuz could quickly change that outlook.