Oil Prices Rise on Extended US Blockade Reports
Oil prices have surged significantly following reports that the United States is preparing for an 'extended' blockade of Iran.
On Wednesday, Brent crude reached approximately $115 (£85) per barrel, up from just over $110 (£81) at Tuesday's close. Prior to midday BST, the price had slightly declined to $114.37 (£84.68).
This increase follows a Wall Street Journal report indicating that US President Donald Trump has directed aides to prepare for a prolonged obstruction of Iran's ports, aiming to exert economic pressure on the country.
In response to the US blockade, Iran has declared its intention to continue disrupting maritime traffic through the Strait of Hormuz.
Impact of the US-Israel-Iran Conflict on Oil Supply
Since the onset of the US-Israel conflict with Iran, oil prices have experienced considerable volatility. The Strait of Hormuz, a critical passageway that typically handles about 20% of the world's oil and liquefied natural gas supplies, has been effectively closed for several weeks due to ongoing hostilities. Despite fluctuations, current prices remain substantially higher than those before the conflict began.
On 17 April, Brent crude prices dropped to $90 per barrel following a ceasefire announcement between Israel and Lebanon. Additionally, the US declared a pause on attacks against Iran on 8 April.
Nevertheless, over the past 12 days, oil prices have steadily increased amid the continuation of the US blockade.
Statements from President Trump and US Officials
On Wednesday, President Trump urged Iran to "get smart soon" and reach a deal after several days of stalemate in conflict resolution efforts.
"The country couldn't get its act together," Trump stated in a post on Truth Social.
The Wall Street Journal cited US officials reporting that the president has instructed his aides to prepare for an extended blockade of Iran's ports to compel Tehran to negotiate.
According to the report, officials indicated that Trump has chosen to maintain economic pressure on Iran through the blockade rather than resuming bombing campaigns or withdrawing from the conflict, as these alternatives carry greater risks.
Iran's Response and Economic Outlook
Iranian officials asserted on Tuesday that the country can endure the blockade by utilizing alternative trade routes.
Meanwhile, the World Bank forecasted on Tuesday that energy prices could surge by 24% in 2026, reaching their highest levels since Russia's full-scale invasion of Ukraine four years ago, assuming the most severe disruptions from the Iran conflict conclude by May.
