Crude oil just exploded higher this week as the Middle East conflict intensifies.
WTI surged over 12%, hitting a 2.5-year high, while gasoline climbed to its highest level in nearly 2 years. The biggest driver is the closure of the Strait of Hormuz, a critical route that carries about 20% of global oil shipments.
With tankers halted and Gulf exporters struggling to move crude, supply fears are pushing prices sharply higher. Some energy officials even warn oil could reach $150 per barrel if the conflict drags on.
Additional disruptions are adding fuel to the rally:
• Drone attacks forced shutdowns at key Saudi facilities
• Fires at major UAE oil storage hubs
• Ongoing sanctions and refinery attacks impacting Russian supply
Despite OPEC+ planning to increase output, the market is focused on one thing right now: geopolitical supply risk.
If the Strait of Hormuz remains closed for weeks, the oil market could face one of its tightest supply shocks in years.