Oil Rises, Hormuz Remains Locked
Oil prices rose for a fifth straight day as the US-Iran standoff casts doubt on the reopening of the Strait of Hormuz. Brent crude oil prices reached US$107 per barrel and are on track for a weekly gain of around 19%, its biggest surge since the initial rally as the Middle East conflict escalated in early March.
According to two US officials familiar with the discussions, President Donald Trump's posts on Truth Social and the decision to continue a naval blockade of Iranian ports are seen worsening negotiations through mediators like Pakistan. The blockade has squeezed Iranian crude exports, the only known outflow from the Persian Gulf since the war began in late February, and remains a key sticking point in bringing Tehran back to the negotiating table.
Meanwhile, a tanker subject to US sanctions and carrying Iranian oil was seen moving to exit the strait, potentially testing the US naval barrier. Ole Hansen of Saxo Bank believes that no steps have been taken to alleviate upward price pressure, while market participants see no clear end to the impasse that is hampering access through the Strait of Hormuz.
This conflict has shaken energy markets, with the near-closure of the Strait of Hormuz temporarily cutting off oil and gas flows from major producers in the Persian Gulf. Prices had eased in recent weeks as a ceasefire raised hopes for a peace deal, but renewed concerns that talks are stalling, coupled with escalating military rhetoric and threats, have again added a geopolitical premium to oil prices.
Goldman Sachs estimates that Persian Gulf oil production will take "several months" to largely recover, assuming Hormuz is fully reopened and there are no new attacks. The bank estimates output cuts of around 14.5 million barrels per day, or more than 50%, in April. Hansen added that even if Hormuz is fully reopened, normalization of flows could still take several months, risking additional tightening, particularly for diesel and aviation fuel, and prompting countries and companies to curb demand. (gn)*
Source: Newsmaker.id
