Oil prices reached their highest levels on Sunday evening, driven by the Trump administration’s indications that the conflict with Iran could extend for several more weeks.
President Donald Trump has called upon the international community to assist in reopening the Strait of Hormuz for oil tankers.
Brent crude, the global benchmark, increased by 2.9%, reaching approximately $106.12 per barrel, while U.S. oil rose by 2.6% to $101.53.
The war led by the U.S. and Israel in Iran has now entered its third week, resulting in unprecedented disruptions to oil supply. The Strait of Hormuz, a crucial waterway under Iranian control, has been effectively closed to oil tankers since the onset of hostilities, with around 20% of the world’s oil supply passing through this chokepoint.
The Trump administration has made efforts to alleviate concerns regarding shipping flows. Trump stated that the U.S. will deploy naval forces to escort and protect oil tankers leaving the Middle East, however, officials have acknowledged that it may take weeks before the Navy is ready to undertake this mission.
In a post on Truth Social on Saturday, Trump urged other nations to collaborate in reopening the strait to restore oil flow “so that everything goes quickly, smoothly, and well.”
Oil prices are typically more volatile during after-hours trading as speculators adjust their positions in lower volume conditions. Last Sunday, prices nearly reached $120 per barrel before settling around $100 on Monday.
Iran has intensified its actions, including laying mines in the strait and threatening to target any U.S.-linked oil and gas infrastructure traversing the area. Since the conflict began on February 28, tankers have also been attacked in the Strait of Hormuz.
The closures of the strait impact more than just oil supplies; farmers worldwide depend on fertilizers transported through this route, which could lead to increased grocery prices. Perishable goods such as dairy, fruits, vegetables, and fish may be among the first items to see price hikes.
By: Madeline Moore