Oil prices surged on 13 April to above $100 per barrel (bbl) as the US Navy prepared to block shipping routes to and from Iran through the Strait of Hormuz, aiming to limit Iranian oil exports.
This development occurred after negotiations between Washington and Tehran failed to resolve the ongoing conflict, reported Reuters.
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By 08:10 GMT, Brent crude futures had increased by $7.03 to $102.23/bbl, recovering from a 0.75% decline on Friday.
Similarly, US West Texas Intermediate (WTI) had risen by $7.31 to $103.88/bbl, bouncing back from a 1.33% loss in the previous session.
US President Donald Trump announced the impending blockade, highlighting a rise in tensions after talks with Iran failed, potentially affecting the current two-week ceasefire.
President Trump noted that oil and gasoline prices could remain elevated until November, touching upon the possible political consequences of his earlier decision to engage militarily with Iran.
The US Central Command confirmed that the blockade, set to commence at 14:00 GMT on Monday, would target all maritime traffic entering and exiting Iranian ports. It said non-Iranian shipments would be allowed to navigate through the Strait without impediment.
Iran’s Revolutionary Guards responded on Sunday, warning that any military intrusion near the Strait would breach the ceasefire and result in immediate retaliatory action.
Meanwhile, physical crude barrels continue to trade at substantial premiums, with certain grades nearing record highs of $150/bbl.
Data from LSEG and Kpler, as reported by Reuters, indicated that the Pakistan-flagged tankers Shalamar and Khairpur entered the Gulf on Sunday, preparing to load crude and refined products in the United Arab Emirates and Kuwait, respectively.
Furthermore, the Liberia-flagged very large crude carrier (VLCC) Mombasa B was shown to be moving within the Gulf. The Malta-flagged VLCC Agios Fanourios I, originally en route to load Iraqi Basra crude, reversed course and anchored near the Gulf of Oman.
Conversely, three supertankers managed to traverse the Strait of Hormuz on Saturday, marking the first successful exits since the ceasefire was established.
