Oil Jumps 4% on Mideast Supply Fears

This rebound follows a previous session where both benchmarks fell below $100 per barrel on initial optimism for a strait reopening. However, market participants remain hesitant to fully strip out geopolitical risk, with no clarity on the impact of U.S.-Iran talks on oil flows.

Vandana Hari, founder of Vanda Insights, stated that a meaningful reopening of the Strait of Hormuz appears dim, predicting continued price volatility. Susannah Streeter, chief investment strategist at Wealth Club, added that even if shipments resume, risks persist due to mined waters, military presence, high insurance premiums, and elevated freight costs.

The ceasefire's viability is questioned by continued Israeli strikes on Lebanon, prompting Iran to deem further peace talks "unreasonable." Regional oil facilities face ongoing threats, including an Iranian strike on a Saudi Arabian pipeline used to bypass the Strait of Hormuz, and missile and drone attacks on Kuwait, Bahrain, and the UAE. Despite these immediate price gains, Goldman Sachs recently trimmed its second-quarter 2026 forecasts, lowering Brent to $90 a barrel from $99 and WTI to $87 a barrel from $91.