Crude oil soars to $120, hits highest level since 2022
Oil prices pushed higher on Thursday as concerns grew over a prolonged U.S. blockade on Iranian exports and a lack of progress in nuclear negotiations, raising the likelihood of tighter supply conditions ahead. Brent prices have now reached their highest levels since mid-2022 as tensions in the Iran war continue to disrupt supply flows through the Strait of Hormuz.
The move follows an Axios report stating that U.S. President Donald Trump rejected Iran’s proposal to reopen the Strait of Hormuz. This suggests the blockade could remain until a broader nuclear deal is reached.
Crude oil price on April 30
Brent crude for June delivery climbed 1.96% to $120 per barrel, while U.S. West Texas Intermediate edged up 0.2% to $107.09.
The rally builds on Wednesday’s sharp gains, when Brent rose about 6% and WTI surged 7%. The Wall Street Journal had earlier reported, citing U.S. officials, that Trump directed aides to prepare for an extended blockade of Iran.
Trump also issued a warning to Iran via a Truth Social post, saying the country “better get smart soon!” He added that Iran was struggling to finalize a non-nuclear deal. The post included an AI-generated image of Trump holding a gun with explosions in the background alongside the phrase “NO MORE MR. NICE GUY!”
Analysts noted that restricted Iranian exports and limited storage capacity could worsen supply disruptions if the blockade continues. While the UAE’s output increase after exiting OPEC may help, it is expected to come through gradually and is unlikely to ease near-term tightness.
As for price outlook, a Haitong Futures note cited by Reuters suggested the current ceasefire may only be a precursor to further conflict. If U.S.-Iran negotiations fail to progress by the end of April and tensions escalate, oil prices could climb to new highs this year.
Macquarie expects crude to stay supported in the $85 to $90 range in the near term, with a gradual rise toward $110 as supply conditions stabilize. However, it warned that extended disruptions through April could push Brent up to $150 per barrel.
Nuvama Institutional Equities also indicated that a prolonged closure of the Strait of Hormuz, which carries around 20 million barrels per day, could drive crude prices into the $110 to $150 range.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
The move follows an Axios report stating that U.S. President Donald Trump rejected Iran’s proposal to reopen the Strait of Hormuz. This suggests the blockade could remain until a broader nuclear deal is reached.
Crude oil price on April 30
Brent crude for June delivery climbed 1.96% to $120 per barrel, while U.S. West Texas Intermediate edged up 0.2% to $107.09.
The rally builds on Wednesday’s sharp gains, when Brent rose about 6% and WTI surged 7%. The Wall Street Journal had earlier reported, citing U.S. officials, that Trump directed aides to prepare for an extended blockade of Iran.
Trump also issued a warning to Iran via a Truth Social post, saying the country “better get smart soon!” He added that Iran was struggling to finalize a non-nuclear deal. The post included an AI-generated image of Trump holding a gun with explosions in the background alongside the phrase “NO MORE MR. NICE GUY!”
Analysts noted that restricted Iranian exports and limited storage capacity could worsen supply disruptions if the blockade continues. While the UAE’s output increase after exiting OPEC may help, it is expected to come through gradually and is unlikely to ease near-term tightness.
As for price outlook, a Haitong Futures note cited by Reuters suggested the current ceasefire may only be a precursor to further conflict. If U.S.-Iran negotiations fail to progress by the end of April and tensions escalate, oil prices could climb to new highs this year.
Macquarie expects crude to stay supported in the $85 to $90 range in the near term, with a gradual rise toward $110 as supply conditions stabilize. However, it warned that extended disruptions through April could push Brent up to $150 per barrel.
Nuvama Institutional Equities also indicated that a prolonged closure of the Strait of Hormuz, which carries around 20 million barrels per day, could drive crude prices into the $110 to $150 range.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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