Brent Crude Surges 10% to Around $80 per Barrel Amid Rising Middle‑East Tensions
The price of Brent crude jumped 10 %, reaching roughly $80 a barrel in over‑the‑counter trading on Sunday. The rally was driven by escalating tensions in the Middle East after U.S. strikes against Iran.
“Military attacks alone are supporting oil prices, but the main factor here is the closure of the Strait of Hormuz,” said Agai Parmar, head of the Energy & Refining unit at I.C.I.S.
Potential to Hit $100 per Barrel
Some analysts believe the barrel could climb to $100 if the situation persists. Since the start of the year, Brent has already posted gains, peaking at $73 on Friday – its highest level since July – amid fears of further attacks.
Shipping Disruptions Through the Strait of Hormuz
- Commercial sources report that most ship owners, oil companies, and major traders have suspended shipments of crude oil, refined products, and liquefied natural gas (LNG) through the Strait of Hormuz.
- Tehran has warned vessels not to navigate the strategic waterway, which carries more than 20 % of global oil supplies.
Parmar added: “Prices could open on Monday around $100 a barrel, and even exceed that level if the strait remains closed for an extended period.”
Helima Croft, analyst at RBC, notes that Middle‑East leaders have warned Washington that a war with Iran could push oil prices above $100. Meanwhile, Rabobank analysts expect short‑term stabilization above $90.
OPEC+ Production Adjustment
The OPEC+ consortium announced on Sunday a modest production increase of 206,000 barrels per day starting in April – less than 0.2 % of global demand.
Impact of a Prolonged Hormuz Closure
Jorge Leon, expert at Rystad Energy, estimates that even with alternative infrastructure far from the strait, its closure could remove 8–10 million barrels per day from the market, despite some flow being rerouted through pipelines in Saudi Arabia and Abu Dhabi.
- Rystad forecasts a price rise of about $20, reaching $92 per barrel at market open.
Regional Re‑shoring of Supplies
The Iranian crisis has prompted Asian governments and refineries to re‑evaluate inventories, supply routes, and alternative sources. Analysts at Kpler indicated that India may turn to Russian crude to offset any potential shortfall in Middle‑East deliveries.
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