After soaring above $126 per barrel during the US-Israel-Iran conflict, Brent crude ended the first half of 2026 near $73, as easing tensions between Washington and Tehran and improving oil flows through the Strait of Hormuz unwound the supply fears that had driven prices to multi-year highs.
The global oil benchmark experienced one of its most volatile first halves in recent years, with prices more than doubling from the start of the year as traders priced in the risk of severe supply disruptions in the Middle East before rapidly unwinding those gains as diplomatic efforts gathered pace.
Brent started 2026 at around $61 a barrel and climbed to an intraday high of $126.41 on April 30, gaining more than 100% as fears mounted that the conflict could disrupt shipments through the Strait of Hormuz, the transit route for about one-fifth of global oil supplies.
The rally reversed after Washington and Tehran announced a framework agreement on June 14 to end hostilities, while improving shipping activity through the Strait of Hormuz further eased supply concerns. Brent ended June at $72.95 a barrel, returning close to levels seen before the outbreak of the conflict.
- Geopolitical risks dominated early trading
Brent began January near $61 a barrel and ended the month at $70.69, supported by expectations that OPEC+ would maintain its production policy and concerns over US measures targeting Venezuela's oil sector.
The benchmark settled at $59.96 on Jan. 7, its lowest close since December 2025, before rebounding after US President Donald Trump raised the possibility of military action against Iran, reviving concerns over Middle East supply security.
The rally gathered momentum later in the month, with Brent closing above $70 for the first time since September 2025. The benchmark averaged $64.5 a barrel in January.
Prices traded largely within a $66 to $72 range through February before geopolitical risks escalated sharply at the end of the month.
- War triggered a historic rally
After trading relatively steadily within a $66-$72 range through February, Brent entered a sharp uptrend following joint US-Israeli strikes on Iran, Tehran's retaliatory actions and a surge in geopolitical risk premiums.
Following the outbreak of the US-Israel-Iran war on February 28, markets began pricing in disruptions to the Strait of Hormuz, a critical artery for global energy trade.
Because the initial strikes took place while markets were closed on February 28 and March 1, the immediate reaction was delayed. The accumulated risk premium was reflected when trading resumed.
Brent, which had settled at $72.48 at the end of February, jumped 7.2% on March 2 to close at $77.74, its highest settlement since January 2025.
Throughout March, fears that the Strait of Hormuz could be shut down, attacks on regional energy infrastructure and mounting supply disruption risks supported prices. At the same time, periodic optimistic remarks from Trump regarding negotiations with Iran triggered occasional single-day declines of more than 10%, though the broader trend remained upward.
Brent ended March at $118.35 a barrel, its highest level since June 2022 and nearly 94% above the start of the year. The monthly average price climbed from $69.2 in February to $98.2 in March.
- Brent peaked above $126 in April
Supply concerns intensified further in April as markets increasingly priced in the possibility of severe disruptions to Middle Eastern oil flows.
Brent reached its 2026 high of $126.41 a barrel on April 30 and finished the month at $114.01 as concerns over Hormuz traffic and ongoing regional hostilities remained elevated.
The benchmark averaged $101.4 a barrel during April.
Prices remained above $100 throughout May, although expectations of higher supplies from non-OPEC producers and downward revisions to global demand forecasts by international organizations helped cap further gains.
However, the geopolitical risk premium kept Brent firmly in triple-digit territory, with the monthly average reaching $102.8 a barrel.
- Peace agreement erased the risk premium
In June, markets witnessed a rapid unwinding of the risk premium that had supported prices for months as reports indicated progress in peace talks between the US and Iran and expectations grew that oil flows through the Strait of Hormuz would return to normal.
Brent fell below $90 on June 12 for the first time since March 10, settling at $87.33.
The decline accelerated after Washington and Tehran announced on June 14 that they had reached an agreement, brokered by Pakistan, to end hostilities and address outstanding disputes through negotiations.
Brent dropped below $80 on June 16 for the first time since March 2, settling at $78.67. Prices subsequently tested $72.42 on June 25, effectively returning to pre-war levels.
On June 26, Brent settled at $72.60, its lowest close since the conflict began and just above the February 27 settlement of $72.48 recorded before the outbreak of hostilities.
The average Brent price declined to $83.9 a barrel in June. After rising from an average of $64.5 in January to more than $102 in May, Brent ended the first half at $72.95, down about 42.3% from its April peak.
After surging above $126 amid war-related supply fears and reaching its highest levels in years, Brent finished the first half of 2026 close to where it traded before the conflict, as diplomatic progress and expectations of normalized shipments through the Strait of Hormuz removed much of the geopolitical risk premium from the market.
The dramatic rise and subsequent collapse in prices made the first six months of 2026 one of the most volatile geopolitical periods for global oil markets in recent years.
By Duygu Alhan
Anadolu Agency
energy@aa.com.tr
