Crude surges past $112 amid fresh US-Iran tensions
What's the story
Oil prices have surged for a third consecutive day, with Brent nearing $112 per barrel and West Texas Intermediate (WTI) surpassing $108. The rise comes as President Donald Trump has once again called on Iran to negotiate an end to the ongoing conflict and reopen the vital Strait of Hormuz. The region is crucial for global oil supply.
Diplomatic tensions
Trump's post intensifies pressure on Iran
Trump's social media post on Sunday intensified the pressure on Iran, saying "For Iran, the Clock is Ticking, and they better get moving, FAST, or there won't be anything left of them. TIME IS OF THE ESSENCE!" The statement came as US-Iran talks remain stalled and a drone strike in the United Arab Emirates over the weekend further destabilized the region.
Supply fears
Morgan Stanley warns of price increases
Morgan Stanley recently warned that the market is in "a race against time," as conditions that have previously prevented price increases from the war could be tested if the vital waterway remains closed until June. Charu Chanana, Chief Investment Strategist at Saxo Markets in Singapore, said "Markets have seen plenty of headlines around possible solutions, but no credible mechanism yet that fully removes the Hormuz supply risk."
Supply pressure
US ends waiver for Russian crude sales
The Trump administration has also increased supply pressure by ending a waiver for Russian crude sales, despite India's request to extend it. This decision comes amid continued attacks on energy facilities in the Persian Gulf over the weekend. A drone strike at a United Arab Emirates nuclear facility highlighted the ceasefire's fragility and underscored the ongoing tensions in the region.