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Geopolitics · Iran War · Oil Prices · Strait Of Hormuz
Oil prices surged as the Iran War entered its third week, with Brent crude hitting $106.5 and WTI peaking at $102.4, following US strikes on Iran's Kharg Island export hub and President Trump's intensified demands for allied naval escorts in the Strait of Hormuz.
The US strikes on Friday targeted military infrastructure on Kharg Island, Iran's primary oil export hub responsible for 90% of its oil exports, according to JPMorgan. US Ambassador Mike Waltz confirmed the Trump administration maintains the option to strike Iran's energy infrastructure.
President Trump appealed to China, France, Japan, South Korea, and the UK to join a naval escort mission, citing their greater reliance on the strait. The White House expects to announce allied commitments this week, while EU foreign ministers will discuss extending their Aspides naval mission, though German Foreign Minister Johann Wadephul expressed skepticism.
Concurrently, the US Department of Energy contributed 172 million barrels to the IEA's 400 million barrel emergency stockpile release. This release is structured as a "loan" to be returned with a premium, differing from previous outright sales, which complicates execution and limits its immediate relief effect.
The first 86 million barrels from the US are due for bids by Tuesday, with IEA stocks from Asia and Oceania immediately available, and European and American stocks arriving by the end of March.
