Oil prices extended gains on Thursday amid concerns that supply disruptions caused by the US-Iran war will persist. Brent crude futures for June rose $1.91, or 1.62%, to $119.94 a barrel as of 0057 GMT after gaining 6.1% in the previous session according to Reuters. The June contract, which has increased for a ninth day, expires on Thursday and the more active July contract was at $111.38, up 94 cents, or 0.85%, after gaining 5.8% in the previous session.
Key Takeaways
Oil prices have surged due to concerns over prolonged supply disruptions caused by the US-Iran war. Brent crude futures rose $1.91, or 1.62%, to $119.94 a barrel, while U.S. West Texas Intermediate futures increased by 63 cents, or 0.59%, at $107.51 a barrel.
- Oil prices extended gains on concerns over supply disruptions from the Middle East war.
- Brent crude futures rose to $119.94 a barrel, while U.S. West Texas Intermediate futures increased to $107.51 a barrel.
- U.S. President Donald Trump met with oil companies to discuss mitigating the impact of a potential blockade of Iran's ports.
- OPEC+ is likely to agree on a small increase in oil output quotas, despite the UAE's withdrawal from the group.
U.S. West Texas Intermediate futures for June were up 63 cents, or 0.59%, at $107.51 a barrel, after climbing 7% in the previous session per Reuters. U.S. President Donald Trump spoke on Wednesday with oil companies about how to mitigate the impact of a possible months-long U.S. blockade of Iran's ports, triggering concerns in the market of an extended disruption to oil supplies.
The meeting with oil companies followed a deadlock in efforts to resolve the conflict that has killed thousands and caused what analysts say is the world's biggest energy disruption ever as reported by Reuters. Tehran has largely blocked all shipping apart from its own from the Gulf through the Strait of Hormuz, a chokepoint for global energy supplies from the Middle East, since the U.S. and Israel began air strikes on Iran on February 28.
The OPEC+ grouping of OPEC countries and its allies is likely to agree on a small increase of around 188,000 barrels per day in oil output quotas on Sunday sources told Reuters. The meeting comes just after the United Arab Emirates' withdrawal from OPEC, effective May 1, which is expected to deal a blow to the oil producer group's ability to control prices.
The price for a barrel of Brent crude to be delivered in July jumped 5.8% to settle at $110.44 per barrel according to Los Angeles Times. That’s where most of the trading is happening in the Brent market, and it got as high as $111.50 earlier in the day.
The highest price since the war with Iran began is $119.50 for the most actively traded Brent contract, reached last month per Los Angeles Times. On Wednesday, the price for a barrel of Brent crude to be delivered in June, which is getting less trading action than July’s contract, briefly breached that mark and got as high as $119.76.
The price of Brent crude oil passed $115 per barrel early Wednesday while President Donald Trump urged Iran on social media to agree to a nuclear deal as reported by UPI. The United States and Iran remain under a cease-fire agreement that began on April 8 but negotiations to end the war have stalled.
The president posted on Wednesday that Iran 'better get smart soon.' 'Iran can't get their act together,' Trump wrote. 'They don't know how to sign a non-nuclear deal. They better get smart soon!' per UPI. The drawn-out closure of the Strait of Hormuz has put immense stress on the global oil market.
The World Bank forecasts a 24% surge in energy prices in 2026 due to the Middle East war, with Brent crude oil prices remaining more than 50% higher in mid-April than they were at the start of the year according to Reuters. The bank's baseline projects a 16% increase in overall commodity prices in 2026, given soaring energy and fertilizer prices and record-high prices for several key metals.
The surge in fertilizer prices would fuel pressures on food supply, eroding farmers' incomes and threatening future crop yields per Reuters. The World Food Programme estimates that 45 million more people could face acute food insecurity this year if the war continues for a prolonged period.
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