Brent crude oil prices hit a 4-year high on Thursday following reports that the U.S. military will brief U.S. President Donald Trump on potential measures against Iran, raising worries that armed conflict could resume, and building on the American blockade of Iranian exports, CNBC reports, according to UNN.
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Axios reported that U.S. Central Command is set to present Trump with plans for possible military action against Iran, citing two sources familiar with the situation.
It was previously reported that Trump rejected Tehran's proposal to reopen the Strait of Hormuz, signaling that the naval blockade will remain in place until a broader nuclear deal is reached.
Trump appears unready to accept Iran's latest proposal to end the war - CNN28.04.26, 09:00
Brent crude futures for June delivery rose 6.84% to $126.10 a barrel as of 00:22 ET (7:22 in Kyiv), while U.S. West Texas Intermediate crude rose 3.14% to $110.24.
According to LSEG data, Brent crude prices reached their highest levels since early 2022, as conflict in the Middle East constrains supply.
Goldman Sachs estimates that exports through the Strait of Hormuz have dropped to 4% of normal levels, with negotiations between the U.S. and Iran and the ongoing U.S. blockade tightening supplies.
UAE announced withdrawal from OPEC and OPEC+28.04.26, 15:36
Iran's limited exports and constrained storage capacity could exacerbate supply disruptions if the blockade persists, bank analysts said, adding that production increases in the UAE following its exit from OPEC are likely to occur gradually over the medium term rather than offsetting short-term deficits.
In a post on Truth Social on Wednesday, Trump appeared to threaten Iran, stating that the country "better get smart fast."
Trump stated that Iran "better get smart fast"29.04.26, 16:05
Bill Perkins, chief investment officer at Skylar Capital Management, said oil markets are being influenced by a combination of physical shocks, geopolitics, and investor psychology, with traders closely monitoring tanker movements and political signals as the U.S.-Iran conflict drags on.
"We are quite far from a deal, and perhaps combat operations or a bit more time are necessary to open the Strait of Hormuz," he said.
While strategic reserves and existing oil in transit have helped mitigate the impact of price increases, he described petroleum product markets as significantly tighter, highlighting the sharp rise in diesel prices and persistent logistical challenges even if a truce is reached.
Goldman pointed to emerging downside risks to demand, noting that global oil consumption in April could be approximately 3.6 million barrels per day lower than in February, with weakness concentrated in the jet fuel and petrochemical feedstock segments.
Looking ahead, Perkins said the price of oil could jump to $140-$150 per barrel if disruptions persist, though elevated prices would eventually curb demand.