Key Highlights
- Brent crude surged to $113.52 per barrel while WTI exceeded $100 amid Trump’s Hormuz Strait ultimatum
- Trump warned of strikes on Iranian power facilities if the strait remains closed; Tehran promised retaliatory action
- Energy infrastructure across nine nations has suffered damage to at least 40 assets since hostilities began
- The IEA characterized the crisis as comparable to combining both 1970s oil shocks with current geopolitical tensions
- Goldman Sachs revised its 2026 Brent crude projection upward to $85 per barrel from $77 due to extended supply constraints
Crude oil markets continued their upward trajectory on Monday as investors dismissed President Trump’s 48-hour demand for Iran to reopen the strategic Strait of Hormuz.
Brent crude, the global pricing benchmark, advanced 1.2% to settle at $113.52 per barrel. West Texas Intermediate, the domestic U.S. grade, jumped 2.5% to close at $100.71 per barrel. The international benchmark has rallied over 50% since coordinated U.S. and Israeli military operations against Iran commenced in late February.
On Saturday, Trump issued an ultimatum demanding Iran “fully open” the Strait of Hormuz within 48 hours, warning of military strikes targeting Iranian electrical infrastructure. Tehran countered with warnings of potential attacks on critical infrastructure throughout the Middle East region.
Market experts expressed doubt that Iran would accept Trump’s conditions within such a compressed timeframe. “Tehran is extremely unlikely to capitulate to Trump’s demands on such an aggressive schedule while facing military threats,” noted Rory Johnston, founder of Commodity Context Corp. “Iran has demonstrated both the capacity and determination to respond to any escalatory measures.”
Treasury Secretary Scott Bessent indicated that American military strikes target defensive installations along the strait, emphasizing that Trump would employ “whatever measures necessary” to prevent Iran from acquiring nuclear weapons capabilities.
The Strait of Hormuz serves as the critical maritime corridor connecting Persian Gulf oil producers to international markets. Shipping activity through this vital waterway has virtually ceased. Gulf region producers have been compelled to either store millions of barrels domestically or utilize constrained alternative export pathways.
IEA Compares Current Disruption to Multiple Historical Crises
International Energy Agency Executive Director Fatih Birol, addressing attendees at an Australian conference, characterized the present supply disruption as matching the combined severity of both 1970s oil shocks and the 2022 natural gas emergency following Russia’s Ukraine invasion.
He revealed that military conflict has severely impacted at least 40 energy facilities spanning nine nations since hostilities commenced. Although the IEA is evaluating emergency strategic petroleum reserve releases, Birol emphasized that such measures alone cannot address the fundamental crisis.
The current confrontation has now persisted for 24 days, lasting twice as long as a comparable crisis involving the same nations last year.
Goldman Sachs Adjusts Oil Market Projections Upward
Goldman Sachs increased its 2026 crude oil price projections over the weekend. The investment bank now anticipates Brent averaging $85 per barrel throughout the year, revised upward from its earlier $77 estimate. The WTI forecast similarly increased to $79 per barrel from $72.
“Crude flows through Hormuz are projected to remain at approximately 5% of normal capacity for six weeks, followed by a phased restoration,” stated analysts led by Daan Struyven.
The team emphasized that prices will likely continue ascending until markets develop confidence that an extended disruption is improbable.
Haris Khurshid, chief investment officer at Karobaar Capital, observed: “We’ll likely need to see more widespread complications affecting maritime transport or insurance markets before prices accelerate more dramatically.”
Saudi Aramco CEO Amin Nasser has cancelled his appearance at the annual CERAWeek conference in Houston, set to begin this week, where oil market dynamics and the ongoing conflict were anticipated to be primary discussion topics.
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