Oil prices remained above $100 a barrel by Monday morning as attacks by both sides of the Iran war have targeted key infrastructure and sparked what has become the biggest energy crisis since at least the 1970s.
ICE futures on international pricing benchmark Brent crude (BZ=F) remained above $102 a barrel, while US benchmark West Texas Intermediate (CL=F) traded above $95 after breaking the key $100 mark late Sunday.
Over the weekend, major actions by both sides pointed towards further escalation of the war.
Late Friday, the US attacked a large number of military assets on Kharg Island, the Iranian regime’s primary oil export terminal, while also threatening to attack oil infrastructure on the island if the conflict continued. Meanwhile, Iranian drone attacks on Saturday and Monday have halted oil loading at the key port of Fujairah in the United Arab Emirates as the conflict continues to threaten the wider Gulf region.
The Strait of Hormuz, the world’s most important shipping lane for oil, remains essentially closed to all but a handful of Indian liquefied petroleum gas tankers making the crossing over the weekend. President Trump called on other world leaders to step up efforts to reopen the Strait of Hormuz, but those international partners avoided taking concrete action.
This week, global central bank meetings will take place, where leaders will grapple with whether the war in Iran will remain temporary or risk becoming a long-term crisis.
“The result is a high-risk impasse that markets are struggling to price in,” Capital analyst Daniela Hathorn wrote in a client note Monday morning. “Energy flows remain largely disrupted, and as long as they remain so, the risk of prolonged global energy shocks remains.”
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