Oil prices whipsaw as Trump’s Hormuz ultimatum and Iran threats keep markets on edge
Aerial view shows oil storage tanks at the Big Spring Refinery in Big Spring, Texas, on March 19, 2026.
Brandon Bell | Getty Images
Oil prices fluctuated Monday as investors weighed the possibility of further gains following President Donald Trump’s ultimatum demanding Tehran reopen the Strait of Hormuz or face attacks on its energy infrastructure.
Iran backtracked, saying it would consider power plants and water facilities in the region “legitimate targets” if its power grid was hit.
International benchmark Brent crude oil rose 0.23% to $112.42 per barrel, recouping its initial losses. US West Texas Intermediate crude oil increased by 0.28% to $98.51 per barrel as of 14:00.
Goldman Sachs sharply raised its oil price forecasts on Monday, expecting Brent to average $110 in March and April; This was higher than the previous estimate of $98, or a 62% increase from the 2025 annual average. The bank also raised its WTI forecasts to $98 in March and $105 in April.
“Assuming the Hormuz flow remains at 5 percent [of normal flows] By April 10, prices are likely to trend higher,” Goldman analysts said, adding that governments realizing the risks associated with concentrated supply and limited domestic capacity could lead to more stockpiling and long-term prices.
If the Hormuz flow remains at 5% for 10 weeks, daily Brent prices will likely exceed the record level set in 2008, Goldman said. Brent crude peaked at around $147 a barrel in July 2008, then fell to around $40 within a few months as the global financial crisis crushed demand.
Oil prices fluctuated on Saturday after US President Donald Trump threatened to “destroy” Tehran’s power plants if it failed to fully reopen the Strait of Hormuz within 48 hours, which ends in Washington on Monday.
Iranian Parliament speaker Mohammed Baqir Qalibaf said that if Iranian power plants are attacked, critical infrastructure and energy facilities in the Gulf region could be “irreversibly destroyed”.
Iran has effectively closed the Strait of Hormuz to most ship traffic since the US-Israeli attack on the country on February 28. The escalating Middle East conflict has caused oil prices to rise in recent weeks amid fears of a deepening supply shock, raising inflation concerns and weighing on growth.
The Strait of Hormuz, which normally holds about 20 percent of global oil supply, is largely closed to commercial shipping.
Iranian state media insisted on Sunday that Tehran would allow all ships, except those linked to Iran, safe passage through the strait. “Enemies of Iran.”
WE natural gas prices It was last traded at $3.101 per million British thermal units, up 0.19%. Front moon Nymex RBOB gasoline April delivery increased by 1.06% to $ 3.3211 and approached the highest levels of the last four years.
International Energy Agency Executive Director Fatih Birol warned on Monday that the situation in the Middle East was dire. “very violent” and far worse than the combined impact of the two oil shocks of the 1970s plus the impact on gas of the Russia-Ukraine war.
IEA member countries agreed on March 11 to remove a record 400 million barrels of oil from strategic stocks to address the supply disruption triggered by the Iran war.
While the IEA president said that he was consulting with governments in Asia and Europe on the release of more stockpiled oil “if necessary”, he emphasized that the most important solution would be “opening the Strait of Hormuz”.
expanding space
The spread between crude benchmark Brent and US WTI exceeded $14 per barrel on Monday; This was the steepest price gap between U.S. and international crude oil benchmarks in recent years.
Gains in Brent crude have outpaced WTI since the start of the war, reflecting the offshore benchmark’s greater sensitivity to geopolitical risk. But WTI crude stored at the landlocked hub of Cushing, Oklahoma, tends to be more insulated from direct supply chain disruptions at sea.
Amrita Sen, founder and director of Energy Aspects Market Intelligence, said this widening gap reflects the risk of more imminent oil supply for countries outside the United States.
“The United States will remain the most protected of all regions,” Sen said, as the country remains the world’s largest oil producer and the administration has begun delivering shipments from the United States. strategic oil reserves.
“It will be enough of a cushion for the United States to not really feel the impact of what’s going on in the Middle East,” Sen said.
Investors are betting on a longer conflict that will keep Brent crude prices higher for longer, Chris Verrone, chief market strategist at Strategas Research, told CNBC’s “Squawk Box Asia” on Monday. The gap could also signal that the market is approaching the “peak intensity of the oil crisis.”
