Oil prices surge as US moves to blockade Strait of Hormuz
Oil and natural gas prices surged as the Strait of Hormuz after weekend talks between Washington and Tehran failed to reach a deal, escalating a global energy crisis that has shaken markets.
Brent rallied as much as 9.1% to near $104 a barrel, while European gas futures spiked almost 18% at one point, News.Az reports, citing Bloomberg.
US forces will begin implementing the blockade, which applies to all vessels entering or departing Iranian ports, from 10 a.m. New York time on Monday, the United States Central Command said.
Global energy markets have been upended by the war in the Middle East, with higher prices threatening to stoke inflation while slowing economic growth. There is now an urgent scramble among refiners and traders around the world for immediately available crude cargoes as physical supplies tighten.
President Donald Trump told reporters that the action would be very effective, while earlier threatening to retaliate in the event of resistance by Tehran. In addition to the blockade, the US leader and advisers were also considering resuming limited strikes, the Wall Street Journal reported.
The Strait of Hormuz, which links the Persian Gulf to global markets, has been effectively closed since US and Israeli strikes on Iran began in late February. Tehran has frustrated the White House by tightening its grip on the route, imposing fees on some vessels and keeping traffic at a fraction of pre-war levels.
Iran was still shipping crude and condensate out of the Persian Gulf in March, with China as the top destination, although flows fell from a month earlier, according to preliminary tracking estimates compiled by Bloomberg.
News.Az
By Nijat Babayev
