Oil Price Volatility Amid Strait of Hormuz Tensions

Oil prices experienced volatility as investors are concerned about talks between the U.S. and Iran and disruptions in the Strait of Hormuz. Brent crude and West Texas Intermediate crude saw fluctuations. Talks are ongoing with Iran refusing immediate reopening of the strategic waterway, affecting global supply chains.

On Monday, oil prices witnessed fluctuations as investors keenly awaited updates on U.S.-Iran negotiations while grappling with disruptions in the Strait of Hormuz. Brent crude futures fell 0.6% to $108.39 per barrel, while U.S. West Texas Intermediate crude dropped 1.2% to $110.21 per barrel.

Last Thursday saw a sharp 11% surge for WTI and an 8% increase for Brent—the most significant rise since 2020. Tensions remained high as Iran rejected terms for reopening the Strait after Trump's ultimatum. Iran insists on its positions amid ceasefire discussions.

Amidst ongoing strife, some ships navigated through the Strait, indicating Iran's selective policy for passage. European markets continued to lose supplies due to Middle East disruptions. Refiners in the U.S. and North Sea are seeking alternative crude sources due to tightening markets.