Crude Oil Prices Rise 5% As U.S. Reserve Drops Below 300 Million Barrels

West Texas Intermediate crude settled 5.1% higher at $82.13 a barrel, while Brent crude price rose 5% to $87.72. The gains came as uncertainty over negotiations to restore tanker traffic through the Strait of Hormuz raised concerns about further pressure on global oil supplies.

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U.S. Oil Reserve Hits 43-Year Low

The U.S. Department of Energy reported that the Strategic Petroleum Reserve (SPR) declined by 6.1 million barrels in the week, taking total holdings to 298.7 million barrels. It was the first time the reserve had fallen below 300 million barrels since January 1983.

The SPR had held about 415 million barrels before the U.S. and Israel launched attacks on Iran on February 28. Repeated releases since then have reduced the stockpile substantially.

The reserve has authorised storage capacity of about 714 million barrels. An Energy Department spokesperson said in July that approximately 70 million barrels was the minimum level required for the SPR to operate safely.

The decline has brought renewed attention to the availability of emergency crude supplies. A Government

Accountability Office report found that more than a quarter of the SPR inventory was unavailable for drawdown as of December 2025 because of construction activity and cavern outages. Rapidan Energy estimated in July that at least 103 million barrels of the existing inventory might not be immediately deployable.

Hormuz Talks Remain Unresolved

Prospects for a quick agreement between Washington and Tehran weakened after U.S. President Donald Trump indicated over the weekend that negotiations were proceeding at a limited pace.

The two countries remain divided over the conditions required to reopen the Strait of Hormuz, a key route for global oil shipments. U.S. Treasury Secretary Scott Bessent had said last week that an agreement could be reached soon to restore freedom of movement through the waterway.

Iranian Foreign Ministry spokesperson Esmaeil Baqaei said on Monday that Tehran would not reopen the route while the U.S. naval blockade remained in place, as reported by Iran’s state news agency Tasnim.

Iran has also sought the removal of U.S. sanctions, compensation for war-related damage, access to frozen assets and an end to planned attacks.

Previous Releases Have Reduced SPR Holdings

The latest drawdown follows large emergency releases ordered during previous supply disruptions. Former U.S. President Joe Biden authorised a 180-million-barrel release in 2022 after Russia’s invasion of Ukraine. Trump ordered a 172-million-barrel release in March after the Iran conflict disrupted oil shipments through the Strait of Hormuz.

The crude oil price had risen as high as $125 a barrel since the conflict began. U.S. gasoline prices have also stayed above $4 a gallon, according to AAA.

The disruption has also affected financial markets. On Monday, the Dow Jones Industrial Average declined 151 points, or 0.3%, while the S&P 500 and Nasdaq fell 0.1% and 0.4%, respectively.

With the Hormuz reopening still unresolved, developments around tanker movements, negotiations and U.S. emergency inventories remain central to the direction of global oil prices.