Watch! Oil Fluctuates After Kharg Attack, Here's Where to Go Next!
Oil prices fluctuated after Iran stated that exports were still flowing from its main export hub, following a US attack on military facilities around Kharg Island. At the same time, US President Donald Trump increased pressure on other countries to help reopen the Strait of Hormuz, which remains nearly paralyzed to tanker traffic.
Brent traded around $105 per barrel after strengthening as much as 3.3% earlier, while WTI hovered near $99. Futures have surged more than 40% in the past two weeks, reflecting a growing geopolitical risk premium since the conflict escalated.
Kharg Island has been in focus because it handles a significant portion of Iran's oil shipments. Following the US attack, Iran launched retaliatory attacks against Israel and Arab states. However, Fars News Agency reported that exports from the island remained normal, allaying fears of an immediate supply cut.
The risk of escalation remains high. The Iranian military reportedly stated that certain areas in Doha and Dubai where US forces are located could be targeted. Dubai International Airport temporarily suspended flights after a drone incident sparked a fire, heightening market sensitivity to infrastructure disruptions in the region.
Meanwhile, Trump said he was “demanding” that other countries contribute to the defense of the Strait of Hormuz, a vital waterway connecting the Persian Gulf to global markets. In an interview with the Financial Times, Trump also suggested he could postpone a summit with Chinese President Xi Jinping if Beijing did not help open the waterway, and warned that NATO would face a “very bad” future if it did not assist in Hormuz.
Market participants believe that last week’s large price spike already included a significant risk premium, so further upside requires evidence of tangible supply losses. Haris Khurshid, CIO of Karobaar Capital LP, said the market appears to be “pricing in disruption, not a full-blown supply shock,” focusing on whether logistical disruptions actually cut into available physical volumes.
To ease supply pressures, the International Energy Agency (IEA) stated that oil from an unprecedented release of reserves will soon be available in Asia, following the implementation of the 400 million barrel release plan announced last week. Japan began the release on Monday, while the US is scheduled to roll out the first tranche of its 172 million barrel commitment this week, although Washington emphasizes the mechanism is a "swap," essentially a loan that companies must repay. In Singapore trading, Brent for May rose 1.3% to $104.45 per barrel, while WTI for April fell 0.7% to $99.36 per barrel. (asd)
Source: Newsmaker.id
