Oil prices have seen their most significant weekly increase since April, yet experts suggest that Brent crude will require a sustained disruption in the Strait of Hormuz or evident signs of global supply tightening to surpass the $90 per barrel mark. On Friday, Brent crude was trading close to $85 after an approximate 11% increase over the week, while the US benchmark West Texas Intermediate neared $80. This rise in prices has been driven by renewed tensions between the United States and Iran, affecting Middle Eastern supply routes and slowing tanker traffic through the crucial Strait of Hormuz.
Despite the increase in regional tensions, Brent crude struggled to break past its weekly high of $87.55 per barrel. Market experts point out that traders are still hopeful about diplomatic efforts that may prevent a prolonged crisis. The Strait of Hormuz remains a focal point for energy markets, given that about 20% of the world’s oil supply is transported through this strategic waterway. The slowdown in tanker movements has led shipping companies to keep a close eye on the security conditions in the area.
The repercussions of these tensions are already noticeable in fuel markets. Refining margins in the United States have increased as diesel and gasoline supplies tighten, while European fuel markets are also experiencing mounting pressure. Additional disruptions to Russian exports have further compounded concerns about global oil supply stability.
According to analysts, oil prices are unlikely to make a decisive move above $90 unless there is a significant decline in inventories or if tensions between Washington and Tehran escalate further, potentially leading to a prolonged disruption in shipping through the Strait of Hormuz. For now, traders are closely monitoring diplomatic developments and supply data, which will be key in determining the next major move in global oil markets.