TLDR
- Brent crude reached $101/barrel Thursday before closing near $98, gaining 6.6% during trading
- Tanker strikes in Iraqi Persian Gulf waters resulted in at least one sailor fatality
- Oman ordered full evacuation of vessels from Mina Al Fahal export terminal as safety measure
- China implemented refined fuel export prohibition in March to secure domestic supplies
- IEA coordinated unprecedented 400 million barrel strategic reserve release to moderate prices
Global oil markets experienced another dramatic surge Thursday following fresh tanker incidents and terminal shutdowns that intensified concerns about Middle Eastern supply security.
Brent crude climbed to $101.59 per barrel during early trading hours before retreating to approximately $98. West Texas Intermediate advanced more than 6% to reach $92.61. These benchmarks had previously approached $120 earlier in the week.
Tanker strikes occurred in northern Persian Gulf waters under Iraqi jurisdiction. Online footage depicted burning vessels. Farhan al-Fartousi, Iraq’s port director, confirmed to The Wall Street Journal that one sailor perished and rescue operations were underway to evacuate remaining crew members. Iraqi authorities closed all national oil ports following the incidents.
Oman took precautionary measures by evacuating all vessels from its Mina Al Fahal export terminal after the recent series of regional shipping incidents. This facility represents one of the limited remaining pathways for Middle Eastern crude to access international markets. Terminal operations subsequently resumed normal activity.
The Strait of Hormuz, accounting for approximately 20% of worldwide oil supply transit, remains functionally blocked. Iranian authorities have declared that crude shipments will face restrictions through the strait. This blockage has compelled Gulf producers including Iraq, Kuwait, and Saudi Arabia to reduce production levels.
China Tightens Fuel Export Curbs
Chinese officials announced an immediate prohibition on refined fuel exports starting in March. Refiners in China also began withdrawing from previously arranged gasoline and diesel export shipments. Leading processors in the country had received instructions to cease negotiating new export agreements.
Goldman Sachs issued warnings that oil prices might surpass the 2008 record of $147.50 per barrel should Hormuz passage restrictions continue through March.
ANZ analysts suggested markets were inadequately accounting for the probable length of supply disruptions. “Oil markets typically transition from uncertainty pricing to endurance pricing once conflicts move beyond their initial shock phase,” their analysis stated.
Emergency Reserve Releases Limit Further Gains
The International Energy Agency coordinated preparations for an unprecedented 400 million barrel release from global strategic reserves. President Donald Trump announced Wednesday that the United States would contribute 172 million barrels from the Strategic Petroleum Reserve.
Neil Beveridge of Sanford C. Bernstein observed that reserve releases represented “nothing compared with the 20 million barrels” per day of supply loss resulting from the Hormuz closure, despite these intervention measures.
The regional conflict reached its thirteenth consecutive day Thursday with resolution remaining uncertain. Iranian officials stated that ceasefire conditions would require assurances from both American and Israeli governments against future strikes on Iran. Washington has yet to accept these conditions.
Speaking to supporters in Kentucky on Wednesday, Trump predicted the conflict would conclude shortly while noting the U.S. “would stay as long as it takes.”
Weekly U.S. oil inventory figures published Wednesday revealed a larger-than-anticipated increase of 3.8 million barrels in the preceding week.
