US Blocks Strait of Hormuz, Oil Prices Surge 7%
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- U.S. announced a naval blockade of the Strait of Hormuz, set to begin Monday at 10 a.m. ET, to curb Iran's oil exports.
- Trump made the announcement on Sunday after peace negotiations in Islamabad collapsed.
- Brent crude for June delivery rose 7.1% to $101.64 per barrel at 8:05 a.m. ET Monday.
- WTI crude for May delivery rose 7.3% to $103.66 per barrel at the same time.
- Iran threatened to retaliate against Gulf ports in response to the U.S. blockade.
- OPEC cut its Q2 global oil demand forecast by 500,000 barrels per day to 105.07 million bpd, down from 105.57 million bpd.
- OPEC maintained its forecast for 2024 global oil demand growth at 1.38 million bpd.
Why it matters: The sudden price surge benefits oil producers and traders while raising costs for consumers and import‑dependent economies; the U.S. blockade escalates geopolitical risk, and OPEC’s demand downgrade signals weaker demand, potentially reshaping global supply strategies for the next quarter overall.
