Mar 26, 2026 - Oil prices surged Thursday as disruptions in the Strait of Hormuz from the ongoing Iran conflict sharply reduced global energy supplies.
Benchmark Brent crude rose more than 5% in early trading to approach $110 per barrel, while West Texas Intermediate climbed toward $98 per barrel, according to market data. The gains followed reports of significantly reduced tanker traffic through the narrow waterway, which normally carries about 20 million barrels per day of crude oil and petroleum products, equivalent to roughly one-fifth of global oil consumption and around 25% of seaborne oil trade.
Iranian restrictions on maritime traffic in the strait, combined with military actions in the region, have cut daily transits to a fraction of normal volumes. Shipping data indicated flows dropped to around 1 million barrels per day or less in recent weeks, with most remaining movements involving Iranian tankers. The decline has affected exports primarily from Gulf producers, including Saudi Arabia, Iraq, the United Arab Emirates and Kuwait, which together account for the majority of shipments through the chokepoint. Asian markets, which receive the bulk of these flows, face the greatest supply pressure.
The conflict escalated in late February with U.S. and Israeli strikes on Iranian targets. Iran responded with missile attacks on regional sites, including a strike on a fuel tank at Kuwait International Airport earlier this week, and maintained control measures in the strait. Earlier in the week, Israeli forces reported killing Alireza Tangsiri, commander of Iran's Islamic Revolutionary Guard Corps Navy, in a strike on Bandar Abbas. Tangsiri oversaw Iranian naval operations in the area.
The U.S. deployment of elements of the 82nd Airborne Division to the Middle East this week added to regional tensions, as did Iran's rejection of a U.S. ceasefire proposal. Diplomatic efforts through intermediaries have not yet produced a resolution.
Energy analysts noted that the supply shortfall has prompted rerouting of tankers and increased reliance on alternative pipelines and stockpiles, though capacity remains limited. Several countries have monitored strategic reserves, while international shipping companies have diverted vessels around the area, raising transit costs and delays.
As of Thursday, oil prices remained volatile amid ongoing military activities in the Persian Gulf region. Limited commercial shipping continued through the strait under heightened security conditions, and no immediate agreement to restore normal flows had been announced.
