Oil Holds Near a One-Month High as the Blockade Bites
Crude held near a one-month high on Thursday, with Brent around $84 to $85 a barrel after climbing more than 10% over the past week, as the US blockade and strikes choked traffic through the Strait of Hormuz. Prices eased slightly in early trading on profit-taking and doubts about demand, but the war premium remains firmly in place; roughly a fifth of the world’s oil and gas normally passes through the strait. Analysts warn prices could retest $100 a barrel if the disruption deepens or oil infrastructure is struck.
The oil price is the war’s clearest transmission to the rest of the world, and the fact that Brent has firmed to around $85 rather than spiking to three figures tells you the market still doubts Iran can or will fully close the strait — there is spare capacity elsewhere and no confirmed halt to the flow. But the balance is fragile: a mined tanker, a hit on a Saudi or Emirati terminal, or a broadening of the fighting could send prices sharply higher within hours, and the shipping that does still move through Hormuz is paying steep war-risk premiums. For Britain the read-through is quick, through petrol and diesel and the gas price that sets energy bills, and a sustained shock would feed straight into inflation just as a new government takes office. Watch the tanker traffic through the strait, the war-risk insurance market, and whether any Gulf oil infrastructure is hit.