Global oil prices climbed for an eighth day on Wednesday, driven by reports that President Trump is set to extend the Iranian port blockade, a move that could further tighten an already stretched energy market.
Brent crude futures for June climbed $1.11, or roughly 1%, to $112.37 a barrel by early morning trading, marking the benchmark’s eighth straight day of gains.
Meanwhile, U.S. West Texas Intermediate (WTI) futures crossed the psychologically significant $100 threshold, rising 51 cents to $100.44 a barrel, capping an extraordinary run in which the contract has gained ground in seven of the last eight sessions.
The rally shows little sign of abating.
Late Tuesday, the Wall Street Journal reported, citing senior U.S. officials, that President Trump has directed aides to draw up plans for a prolonged blockade of Iranian ports, doubling down on a maximum pressure strategy designed to strangle Tehran’s oil revenues and force concessions on its nuclear program.
The report landed like a flare in an already volatile market.
“The Strait blockade has driven the recent rise in oil prices,” said Yang An, an analyst at Haitong Futures. “If Trump is prepared to extend the blockade, supply disruptions would worsen further and continue to push oil prices higher.”
That assessment reflects a broader consensus among traders and analysts who have been watching the geopolitical standoff with growing alarm. Iran’s decision to shut the Strait of Hormuz, the narrow waterway through which approximately 20% of the world’s oil and liquefied natural gas supplies flow daily, has sent shockwaves through commodity markets, with no clear resolution in sight.
Despite a fragile ceasefire ending the direct U.S.-Israeli military campaign against Iran, the broader conflict remains deeply entrenched. Diplomatic channels are gridlocked as both sides dig into irreconcilable positions ahead of any formal peace agreement.
Washington is pressing Tehran to dismantle what it characterizes as a clandestine nuclear weapons program. Iran, for its part, is demanding reparations for the latest round of fighting, a comprehensive easing of economic sanctions, and crucially, some measure of sovereign control over the Strait of Hormuz itself. That last demand alone makes any near-term resolution appear distant at best.
The Hormuz closure is doing tangible damage to global supply chains. Late Tuesday, market sources confirmed that the American Petroleum Institute (API) reported U.S. crude oil inventories declined for a second consecutive week, falling by 1.79 million barrels in the week ending April 24.
Gasoline stocks dropped by a striking 8.47 million barrels, while distillate inventories shed 2.60 million barrels, painting a worrying picture of accelerating drawdowns from global reserves as the world scrambles to compensate for interrupted flows.
Compounding the market’s anxiety is the United Arab Emirates’ unexpected announcement that it is withdrawing from OPEC, a move that caught analysts and traders off guard and injected fresh uncertainty into the already fragile supply outlook.
Most market observers are not expecting an immediate shock from the Abu Dhabi government’s decision. However, the longer-term implications are harder to dismiss.
Analysts at ING noted in a research note on Wednesday that before any boost from increased UAE output can materialize, there must first be a resolution in the Persian Gulf that allows energy flows through the Strait of Hormuz to resume freely, a prerequisite that seems far from assured.
Looking further ahead, ING analysts warned that the UAE’s exit from OPEC, which frees it from production quotas, ultimately signals more supply for the market over the medium-to-long term.
That prospect, they argued, should push the Brent forward curve into deeper backwardation, meaning near-term prices would trade at an increasing premium to future contracts, a structure that reflects immediate scarcity rather than longer-term abundance.
For energy traders, the convergence of forces at play, an extended blockade, a shuttered strait, dwindling inventories, a ceasefire that is anything but peaceful, and a reshaping of OPEC’s membership represent a near-perfect storm of supply-side risk.
With the June Brent contract expiring on Thursday, attention is already shifting to the more actively traded July contract, which stood at $105.32 a barrel, up 0.88% on the session.
As long as the Strait of Hormuz remains shuttered and the Trump administration shows no inclination to lift its blockade on Iranian ports, one thing appears certain: the world’s energy markets are in for a prolonged period of elevated prices, thinning reserves, and deeply unsettled nerves.
WHAT YOU SHOULD KNOW
Global oil markets are in the grip of a supply crisis driven by one central flashpoint: the closure of the Strait of Hormuz.
With the U.S. poised to extend its blockade of Iranian ports and diplomatic talks deadlocked, there is no resolution in sight. Brent crude has crossed $112 a barrel, and WTI has breached $100, with inventories draining fast.
Until the Strait reopens and the U.S.-Iran standoff is resolved, expect oil prices to keep climbing and the pain at the pump to deepen for consumers worldwide.
