Oil prices experienced a sharp rebound on Thursday as lingering uncertainties over the stability of a two-week ceasefire in the Middle East rekindled fears over global energy security. The brief period of optimism, during which benchmark prices fell below $100 per barrel, has given way to a renewed focus on the potential disruption of crude flows through the strategically critical Strait of Hormuz.
Brent crude futures climbed $1.96, or 2.07%, reaching $96.71 per barrel, while U.S. West Texas Intermediate (WTI) rose $2.60, or 2.75%, to $97.01 per barrel. Analysts indicate that geopolitical risk premiums remain deeply entrenched in the market, reflecting persistent uncertainty. Although hostilities between the U.S. and Iran have formally ceased, ongoing military friction and retaliatory strikes across the Gulf region continue to test the viability of the truce.
The Strait of Hormuz, a vital maritime corridor responsible for roughly 20% of global oil and gas supply, remains at the center of the crisis. Iranian authorities have reportedly provided navigational maps to guide vessels around naval mines, yet major shipping companies are hesitant to resume operations without full security guarantees and clear insurance arrangements. Logistics specialists at Standard Chartered have cautioned that operational constraints and heightened security concerns mean that very little additional oil supply is likely to reach international markets through the Strait in the near term.
Adding to supply pressures are reports of attacks on regional energy infrastructure. A strategic Saudi pipeline, built to bypass the Hormuz blockade, was recently targeted, while similar drone and missile strikes in Kuwait, Bahrain, and the UAE indicate that energy facilities remain vulnerable despite the diplomatic truce.
Investment banks, including Goldman Sachs, have slightly reduced second-quarter forecasts due to a minor decrease in the front-end risk premium. However, the broader oil market remains highly volatile. As long as the “uneasy silence” continues along the Gulf front lines without a verified reopening of this vital waterway, oil prices are expected to maintain an upward trajectory, reflecting both geopolitical risk and constrained supply.
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Oil Prices Plunge Below $100 After Trump Announces Two-Week Ceasefire With Iran
