Oil market whipsaws as U.S.-Iran airstrikes push Brent to $77.72 while UAE pumps 3.8 million bpd
Brent crude was up 2.3% at $77.72 a barrel and WTI up 2.1% at $72.92 after the U.S. and Iran traded airstrikes. That reverses most of the slide that had crude drifting back toward pre-war levels, and it puts a floor under wholesale costs for anyone buying product this week.
The supply picture underneath the price is the part worth your attention. Crude had erased most of its wartime gains as barrels came back and oversupply worries returned. Now the shooting has resumed and the Strait of Hormuz is back in the conversation.
What the UAE is pumping
The UAE told OPEC it produced 3.8 million barrels a day of crude in June, an 80% jump and an increase of 1.71 million bpd from May, according to a monthly report seen by Bloomberg on July 13. Abu Dhabi left the producer group, so it is no longer holding back barrels, and it found workarounds for the Iran war.
That figure covers June, before the latest U.S.-Iran flare-up. So the market is looking at a big new stream of Gulf crude and a fresh reason to worry about Gulf crude moving at all. Nigeria adds to the supply side: 1.56 million bpd in June, its highest monthly average since April 2020 per the Nigerian Upstream Petroleum Regulatory Commission, with total crude and condensate at 1.735 million bpd and rising for a fourth straight month.
Refining margins
Crude and product are not moving together. The IEA's latest monthly report has refining margins at four-year highs. For a jobber, that gap is the practical number: rack prices are being set by tight product, not by whatever the crude screen does on any given day.
Thin product supply with plenty of crude around is a good place for a refiner and an expensive one for a buyer. If margins hold at these levels, wholesale gasoline and diesel could stay elevated even in a week when crude gives some of this back.
Ethanol forecast
EIA raised its 2027 fuel ethanol production forecast in the Short-Term Energy Outlook released July 7 and revised 2026 down. Blenders should note the near-term trim, since that is the year that touches current contracts.
Greenfield Global announced an exclusive long-term agreement on July 7 with Show Me Ethanol, a Missouri high-purity alcohol producer. It is a beverage- and industrial-grade alcohol deal more than a fuel one, but it puts another claim on Midwest corn ethanol capacity.
What to watch
Whether Hormuz stays open, and whether UAE holds June's 3.8 million bpd through July. Watch the crack spread more closely than the crude tape. If IEA's four-year-high margins start to compress, that is the first sign product costs may ease at the rack.