World oil prices rose on Monday after US President Donald Trump set a new deadline for Iran to open the Strait of Hormuz. Amid new threats of strikes on Iran's infrastructure, Brent crude exceeded $111 per barrel, Reuters reports, according to UNN.
Details
At the start of trading, Brent crude for June delivery rose to $111.48 per barrel, and WTI for May delivery rose to $114.88. The market is reacting to the risk of further supply disruptions, as the Strait of Hormuz remains a critically important route for global energy exports.
What Trump said
Trump stated that Iran must open the Strait of Hormuz by Tuesday evening US Eastern Time. Otherwise, he threatened strikes on power plants, bridges, and other infrastructure in the country.
Against the backdrop of these statements, investors are once again pricing in the risk of further escalation in the Middle East. The market's nervousness is further exacerbated by the fact that Trump has in recent weeks alternated signals of possible de-escalation with harsh public threats against Tehran.
Why the market reacts so sharply
The main reason for the price jump is fears of a prolonged disruption of supplies through the Strait of Hormuz, which connects the Persian Gulf with world markets. A significant part of the world's seaborne oil exports passes through this route, so any restrictions immediately hit the market.
The situation was further exacerbated by the position of OPEC+, which, after a weekend meeting, warned that damage to energy infrastructure in the region could have long-term consequences for supplies even after the end of hostilities.
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