Oil Prices Fall 7% This Week

Oil prices are heading for a 7 percent weekly loss as markets struggle to price in conflicting signals from U.S.-Iran negotiations and ongoing attacks in the Middle East. ICE Brent crude is set to close the week at $101 per barrel even as missile strikes and drone hits continue.

Investors have waited for clearer news on the situation as the U.S. and Iran sent mixed signals on prospects for a negotiated settlement. Oil markets have been whipsawed by the uncertainty. A Chinese-owned oil product tanker was attacked on Thursday off the UAE coast, the first time a vessel with a Chinese owner and crew was targeted in the current conflict.

Officials seized the oil tanker Ocean Koi, which had been routinely carrying Iranian fuel oil to the port of Fujairah in the UAE. The vessel was escorted to the southern coast of Iran after authorities claimed it attempted to disrupt the country’s oil exports by exploiting regional conditions.

The conflicting developments have left traders uncertain about the outlook for any quick diplomatic breakthrough between Washington and Tehran. Tankers have been stranded once again following that decision. European airlines have faced sharp increases in fuel costs from disruptions in the Strait of Hormuz.

Lufthansa warned that a closure of the strait would add $2 billion in fuel costs. European spot premiums for jet fuel have since dipped to their lowest level since the conflict began.

Europe is unlikely to meet its own natural gas restocking target. The continent’s storage is currently only 34 percent full and is not expected to reach the targeted 80 percent level before next winter, according to the region’s largest supplier. This shortfall is pushing gas prices higher.

Saudi Aramco set the June-loading formula price for its Asian deliveries at a $15.50 per barrel premium to Oman/Dubai. That represents a $4 per barrel drop from the previous month despite expectations of a larger cut of $10 to $15 per barrel. The smaller-than-expected reduction disappointed some buyers even as Hormuz risks persist.

Australia confirmed a new gas reservation policy requiring LNG exporters to reserve at least 20 percent of their natural gas output for the domestic market starting from July 2027. The policy exempts deals signed before December 2025.

BP told staff that a reorganization plan to carve the company into two main business units would begin as early as June. The incoming chief executive outlined the upstream and downstream split in an internal address. Separately, China’s financial regulator asked the country’s largest banks to temporarily suspend new loans to five refineries recently sanctioned by the U.S. over alleged imports of Iranian oil.

A U.S. The decision adds another layer of uncertainty to global trade flows already disrupted by the energy crisis. Average U.S. gasoline prices topped $4.50 per gallon, nearing a four-year high.

“Oil prices are set for a 7% weekly loss after markets remain confused about the outlook of a potential US-Iran negotiated settlement." — OilPrice.com, May 08, 2026 The combination of diplomatic uncertainty, physical attacks on shipping, and policy responses has produced volatile trading across oil, gas, and refined product markets. More than 40 India-bound ships remain trapped near Hormuz while the first oil tanker reached South Korea through the strait since the conflict began.”