Middle East Crisis Oil Market

Oil Warning: “Could Pass $100 a Barrel”

The oil market is bracing for continued turbulence after traffic through the Strait of Hormuz slowed down. Several experts warn that disruptions could push prices up further if the conflict worsens.

“In the event of longer-term disruptions, we see a possible scenario where the oil price exceeds $100 a barrel,” Rystad Energy’s geopolitical analyst Jorge Leon told Bloomberg.

Other analysts emphasize that even short interruptions in the strait can have a major effect, since a fifth of the world’s oil passes through it.

Strait of Hormuz in Focus After Attacks: “The Aorta of the Global Energy System”

US and Israeli attacks on Iran are shaking markets and turning the spotlight on the strategically crucial transportation route, the Strait of Hormuz. A longer interruption there could have global consequences.

– It is the aorta of the global energy system, says SPI manager Stephen Innes.

Around a fifth of the world's oil and natural gas flows pass through the strait, which makes the conflict a risk to the entire world economy. On Monday, several media outlets reported that tanker traffic has effectively slowed down, causing oil prices to soar. 

Tangled in the Strait of Hormuz – oil prices soar

Oil prices rose on Monday morning after tanker traffic through the Strait of Hormuz effectively slowed down, several media outlets reported. This comes as shipping companies and traders pause passages in the shadow of the escalating conflict over Iran.

Brent is up around 6 percent to around $77 per barrel, after having nosedived around $80 overnight. The Strait of Hormuz – a strategic bottleneck for about a fifth of the world's oil trade – is said to be formally open, but Iran confirms attacks on three tankers.

Opec+ has decided at a previously planned meeting to raise production quotas by 206,000 barrels per day, but the market's focus is on whether flows can be normalized quickly, writes Direkt. Citi sees in its main scenario that Brent will trade in the range of 80–90 dollars per barrel for at least the coming week.