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Oil Prices Surge 2 Percent as U.S.-Iran Ceasefire Hopes Fade
(MENAFN) Oil prices climbed roughly 2% on Thursday as fading hopes for a US-Iran diplomatic breakthrough and continued bottlenecks at the Strait of Hormuz stoked fresh fears of prolonged supply disruptions across global energy markets.
Brent crude futures traded at approximately $104 per barrel as of 1015GMT — up more than 2% on the day — while US benchmark West Texas Intermediate (WTI) advanced to around $95, posting comparable gains.
The rally was fueled by mounting anxiety over shipping constraints at the Strait of Hormuz, through which approximately one-fifth of global petroleum consumption flows, according to the US Energy Information Administration. Prospects for a swift ceasefire between Washington and Tehran continued to dim, reinforcing market concerns over sustained supply disruption.
Sentiment deteriorated further after Iranian media reported that Tehran had collected its first toll payment for commercial passage through the waterway. A news agency, citing Iran's deputy parliament speaker, confirmed receipt of the inaugural payment under the new arrangement — a development that deepened concerns over tightening controls on commercial navigation through the strait.
The International Energy Agency (IEA) amplified those fears with stark warnings over the scope of the crisis. IEA Executive Director Fatih Birol, speaking to media at the Converge Live event in Singapore, delivered a sobering assessment of the global energy landscape.
"Europe gets about 75% of its jet fuel from refineries in the Middle East and this is basically now zero," Birol said, adding that Europe is trying to secure alternative supplies from the US and Nigeria.
Birol warned that the world is confronting "the biggest energy security threat in history" as the Iran war and Strait of Hormuz disruptions exact a severe toll on global energy flows. He disclosed that markets have already absorbed the loss of approximately 13 million barrels per day in oil supply, compounded by sweeping disruptions across other critical commodity sectors.
Brent crude futures traded at approximately $104 per barrel as of 1015GMT — up more than 2% on the day — while US benchmark West Texas Intermediate (WTI) advanced to around $95, posting comparable gains.
The rally was fueled by mounting anxiety over shipping constraints at the Strait of Hormuz, through which approximately one-fifth of global petroleum consumption flows, according to the US Energy Information Administration. Prospects for a swift ceasefire between Washington and Tehran continued to dim, reinforcing market concerns over sustained supply disruption.
Sentiment deteriorated further after Iranian media reported that Tehran had collected its first toll payment for commercial passage through the waterway. A news agency, citing Iran's deputy parliament speaker, confirmed receipt of the inaugural payment under the new arrangement — a development that deepened concerns over tightening controls on commercial navigation through the strait.
The International Energy Agency (IEA) amplified those fears with stark warnings over the scope of the crisis. IEA Executive Director Fatih Birol, speaking to media at the Converge Live event in Singapore, delivered a sobering assessment of the global energy landscape.
"Europe gets about 75% of its jet fuel from refineries in the Middle East and this is basically now zero," Birol said, adding that Europe is trying to secure alternative supplies from the US and Nigeria.
Birol warned that the world is confronting "the biggest energy security threat in history" as the Iran war and Strait of Hormuz disruptions exact a severe toll on global energy flows. He disclosed that markets have already absorbed the loss of approximately 13 million barrels per day in oil supply, compounded by sweeping disruptions across other critical commodity sectors.
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