Oil Prices Surge on US Naval Strait of Hormuz Blockade
The prices of crude oil surged sharply on Monday amid heightened concerns about prolonged disruptions to global oil supply following US President Donald Trump’s statements on a blockade of the Strait of Hormuz.
International benchmark Brent crude futures traded at $101.44 per barrel, up around 6.55% from the previous close of $95.20. US benchmark West Texas Intermediate (WTI) gained about 7% to $103.33 per barrel, compared with $96.57 in the previous session.
Trump said on Sunday that the US will blockade “any and all ships trying to enter or leave the Strait of Hormuz” after Saturday’s talks with Iran in the Pakistani capital Islamabad failed to produce a deal to end weeks of war in the Middle East.
“The Blockade will begin shortly. Other Countries will be involved with this Blockade. Iran will not be allowed to profit off this Illegal Act of extortion,” Trump said on his Truth Social media platform.
The US president also said he ordered the US Navy to “seek and interdict every vessel in International Waters that has paid a toll to Iran.”
Later on Sunday, US Central Command (CENTCOM) announced that it will begin implementing a naval blockade of all maritime traffic entering and exiting Iranian ports on Monday at 10 a.m. ET.
According to a London-based maritime intelligence provider, Lloyd’s List, shipping through the Strait of Hormuz halted immediately after Trump announced the blockade. Traffic had already been operating at reduced levels.
The blockade announcement followed rare direct talks between Washington and Tehran in Islamabad on Saturday aimed at ending the war that began on Feb. 28. The talks were held under a Pakistani-mediated two-week ceasefire announced earlier last week.
Since the outbreak of the conflict, Iran has imposed restrictions on ship movements through the Strait of Hormuz, a critical transit route for global oil and gas shipments. What World Bank Oil Import Advice Means for Nigerians
