Brent Briefly Tops $100 as Iran War Deepens Supply Risks
Brent crude briefly pushed back above $100 a barrel as the Iran war triggered fresh shipping turmoil in the Middle East and China tightened refined-fuel export curbs to cope with the conflict’s fallout. The move underscored that the market remains focused on physical supply and transit risk, even after a record strategic-reserve release aimed at cooling prices.
The global benchmark surged as much as 10% to $101.59 a barrel, while WTI climbed toward $96, before both pared gains. Two tankers were struck in Iraqi waters and Oman temporarily cleared vessels from its key export terminal outside the Strait of Hormuz, highlighting widening threats to energy supply and overshadowing efforts to damp prices through emergency stock releases.
On Thursday, the International Energy Agency (IEA) warned the current disruption is the largest in the history of the global oil market, reinforcing a week of wild swings. Volatility has also been amplified by financial flows, from options markets to exchange-traded funds, as traders respond in real time to rapidly changing headlines.
Signs of strain are emerging in Asia as well. Chinese refiners have begun canceling agreed cargoes of refined-fuel exports, including gasoline and diesel. China’s top processors were told last week to stop signing new contracts, and the latest directive is a tighter step beyond earlier guidance.
Meanwhile, the Strait of Hormuz—through which roughly one-fifth of global oil typically flows—remains effectively closed to commercial shipping, forcing major Gulf producers to cut output. Prices for natural gas and refined products such as diesel have surged alongside crude, with Brent and WTI spiking toward $120 earlier in the week before pulling back. Markets have been repeatedly whipsawed by dramatic intraday fluctuations.
Goldman Sachs warned that oil could exceed its 2008 peak if flows via Hormuz remain depressed through March. Brent reached $147.50 that year amid surging demand and stagnant supply. “The only thing that’s really going to bring oil prices back down is if we really see the Strait of Hormuz reopen,” said Neil Beveridge, director of research at Sanford C. Bernstein, adding that strategic reserve flows are “nothing compared with the 20 million barrels a day” of disruption implied by a Hormuz shutdown.
Operational disruptions have added to market anxiety. Iraq halted operations at its oil terminals after the tankers were struck, according to Iraqi state media. Oman also evacuated all vessels from Mina Al Fahal as a precaution, though operations later returned to normal. The terminal is one of the few remaining ports through which Middle East crude can still be shipped to global markets.
Production curbs have expanded since Hormuz became near-impassable, beginning with Iraq and later spreading to Kuwait and Saudi Arabia. Those cuts helped push the IEA into a coordinated 400 million barrel release—far larger than the drawdown following Russia’s invasion of Ukraine in 2022—while the U.S. separately announced plans to release 172 million barrels. Still, global crude consumption is just over 100 million barrels a day, and Gulf producers have already reduced output by roughly 6% of that total, with the risk of deeper cuts still on the table.
Some market participants questioned whether the IEA move was being ignored. “This is what I was concerned about with the IEA release — completely ignored, and now prices are higher,” said Darrell Fletcher, managing director for commodities at Bannockburn Capital Markets. “It may have sent the wrong signal. What do they know that we don’t?”
Diplomacy remains uncertain. Iran told regional intermediaries that any ceasefire would require the U.S. to guarantee that neither it nor Israel would strike Iran in the future—terms Washington is unlikely to accept—further dimming expectations the war will end soon. President Donald Trump reiterated the conflict would end soon, while also indicating the U.S. would stay as long as needed to meet its objectives.
Latest prices (London morning):
Brent (May) up 6.4% at $97.90 a barrel.
WTI (April) up 6.1% at $92.60 a barrel.
Source : Newsmaker.id
