Crude oil prices spiked sharply on Sunday evening after the United States and Israel launched strikes on Iran, sending the brent crude oil price briefly above $82 a barrel. The move reflected growing middle east tensions oil market fears — particularly over access to the strait of Hormuz oil supply route, through which roughly one-fifth of the world’s daily oil flows.
Source: LSEG Data & Analytics / The New York Times
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Oil Prices Today As Strait Of Hormuz Risks Rise
Markets React Fast
Crude oil prices today opened around $72 for US crude and hit $82 for brent before pulling back below $78. The brent crude oil price had settled just above $73 on Friday, meaning the gap was steep — though analysts said the move was within the expected range for this scenario.
Source: FactSet / AAA / The New York Times
Tanker traffic through the strait of hormuz oil supply route dropped to just six vessels on Sunday, from 65 on Friday, according to S&P Global Energy. Videos verified by the New York Times showed a tanker ablaze near Oman.
Amy Myers Jaffe — Director, Energy, Climate Justice and Sustainability Lab, NYU — stated:
“The biggest question is what, if any, oil installations get damaged. If the answer to that is none, my opinion is the price of oil will come back down.”
Source: S&P Global Energy / CNN
Gas Prices and the Wider Risk
The middle east tensions oil market fallout is already being felt at the pump. National gas prices average $2.98 a gallon, and Tom Kloza, veteran oil analyst and advisor to Gulf Oil, warned that could change fast.
Tom Kloza — Oil Analyst, Gulf Oil Advisor — stated:
“Clearly, there’s a whiff of panic there. They’re afraid that they’re going to get hit with massive price increases. It’s just, where do we stop? Prior to Friday night, I would have said that we would stop at $3.25. Now it’s kind of open ended.”
Jason Bordoff — Founding Director, Center on Global Energy Policy, Columbia University — stated:
“Americans will see some impact at the gasoline pump. But even with a massive strike on Iran that killed the leader of the country, at this point we’re still talking about oil prices that are well within historical norms — and much less than one would have ever expected with a strike of this magnitude.”
OPEC+ announced a modest output increase for April, but analysts don’t expect it to keep crude oil prices today in check if the conflict drags on.
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