Global oil prices jumped sharply on Wednesday, reaching their highest levels since the beginning of the conflict between the United States and Iran, after President Donald Trump signalled that Washington would maintain pressure on Tehran and continue measures affecting Iranian oil exports.
The market reaction was immediate. Brent crude, the international benchmark, rose above $118 per barrel during regular trading before briefly climbing toward $120 in after-hours trading. U.S. West Texas Intermediate (WTI) also surged above $106, marking its strongest level in weeks. Analysts said the rally reflected growing fears of prolonged supply disruptions in the Middle East and uncertainty surrounding maritime traffic through the Strait of Hormuz. (Reuters)
Trump’s Comments Trigger New Market Shock
The spike came after Trump reportedly instructed advisers to prepare for an extended blockade on Iranian ports and oil shipments unless Tehran agrees to stricter nuclear terms. According to multiple reports, the White House views economic pressure as more effective than immediate military escalation.
Trump stated that Iran must fully abandon any path toward nuclear weapons before sanctions or restrictions are lifted. He also described the blockade strategy as “foolproof,” signalling that Washington is prepared for a longer confrontation. (New York Post)
Energy traders interpreted the remarks as a sign that millions of barrels of Iranian crude could remain off global markets longer than expected. Iran is one of the region’s major producers, and any reduction in exports tends to tighten supply and push prices upward.
Strait of Hormuz Remains a Major Concern
Another major factor driving oil higher is the continuing disruption in the Strait of Hormuz, one of the most strategically important waterways in the world. Roughly one-fifth of global oil and gas flows typically pass through the narrow channel linking the Persian Gulf to international markets.
Recent tensions have reduced tanker traffic, delayed shipments, and increased insurance and freight costs for shipping companies. Several producers in the Gulf have already rerouted cargoes or adjusted export logistics to avoid risk. Reuters reported that some Abu Dhabi crude shipments were redirected outside the Gulf because of the security situation. (Reuters)
Highest Levels Since the War Began
According to the Wall Street Journal, Brent crude touched nearly $119.76 per barrel, the highest wartime level since the conflict began and a price not seen since the energy shocks following Russia’s 2022 invasion of Ukraine. (The Wall Street Journal)
The Guardian also reported that oil was nearing $120 for the first time in almost four years after Trump reaffirmed the blockade policy and rejected Iran’s latest proposal regarding shipping access and nuclear talks. (The Guardian)
This means the latest surge has erased earlier declines that followed hopes of a ceasefire and possible negotiations.
Impact on Fuel Prices and Inflation
Consumers are already feeling the rise in crude prices. In the United States, average gasoline prices climbed above $4.22 per gallon, their highest level in years. Analysts warn that if oil remains above $115–$120, petrol and diesel prices could continue rising globally in the coming weeks. (The Guardian)
Higher fuel prices often feed directly into transport, airline tickets, food delivery, and manufacturing costs, increasing inflation pressure for households and businesses alike.
Central banks, including the U.S. Federal Reserve and the Bank of England, are now watching energy markets closely, since prolonged oil shocks can delay interest-rate cuts.
What Happens Next?
Traders are now focused on three key developments:
- Whether the U.S. formally extends or intensifies the blockade on Iran
- Whether Tehran retaliates by further disrupting Gulf shipping
- Whether emergency diplomatic talks restart
If tensions worsen, some analysts believe Brent crude could test $125 or even $130 per barrel. If diplomacy resumes, prices may retreat quickly.
For now, markets are treating Trump’s latest announcement as a sign that the U.S.-Iran standoff is far from over — and oil investors are pricing in the risk of a prolonged energy crisis.