Oil Breaks $81, Hormuz Risks Drive Rally Continued
Oil prices continued their rally on Tuesday (March 3), driven by growing concerns about supply disruptions amid the escalating US-Israel conflict with Iran and threats to energy shipping routes in the Strait of Hormuz. At 08:45 GMT, Brent was at $81.89 per barrel (+5.1%), while WTI rose to $75.00 per barrel (+5%).
These gains added to the previous session's significant surge. Reuters noted that Brent briefly touched $82.37—its highest level since January 2025—before closing up around 6.7%, while WTI briefly reached its highest level since June 2025 and ended the day up around 6.3%.
Market sentiment was supported by rising risks in the Strait of Hormuz, a strategic waterway through which approximately 20% of the world's oil and gas supplies pass. Several tankers and container ships were reportedly avoiding the route after some insurers canceled coverage amid warnings from Iran regarding shipping security.
Beyond shipping issues, the market is also weighing the risk of attacks on regional energy infrastructure. Reuters highlighted concerns that the greater threat lies not only with oil flows in Hormuz, but also with the potential for Iran to target additional energy facilities, which could trigger longer supply disruptions.
Nevertheless, some market participants believe that a geopolitical risk premium has begun to be "priced in," assuming the disruption will be limited and can be absorbed if no further escalation occurs. However, sensitivity remains high as the conflict is seen as showing no signs of rapid de-escalation, potentially leading to persistent price volatility.
From a policy perspective, Washington has signaled its intention to respond to the surge in energy costs. US Secretary of State Marco Rubio said the US government will take steps to mitigate the impact of rising energy prices, with plans to be announced on Tuesday by relevant officials. Nevertheless, for global markets, the primary focus remains on geopolitical headlines: as long as the risks from Hormuz and threats to energy infrastructure remain unabated, oil prices are likely to remain supported—and potentially pressure risk assets through inflation and interest rate expectations.
Source: Newsmaker.id
