Oil markets moved higher on Thursday as supply fears intensified amid the continuing closure of the Strait of Hormuz, a critical artery for global energy trade. The prolonged disruption, driven by escalating hostilities between the United States and Iran, has significantly curtailed oil and gas flows from the Middle East.
Brent crude advanced by $1.67, or 2.05%, to $83.07 per barrel in early trading, while U.S. West Texas Intermediate crude climbed $1.94, or 2.60%, to $76.60.
Tensions widened after a U.S. strike targeted an Iranian naval vessel near Sri Lanka. In Washington, lawmakers in the United States Senate voted down a bipartisan proposal that sought to halt the air campaign and require congressional authorization for further military engagement with Iran.
Supply constraints deepened as Iraq, the second-largest producer in OPEC, reduced output by nearly 1.5 million barrels per day due to storage shortages and limited export routes. Meanwhile, Qatar, the region’s largest liquefied natural gas exporter, declared force majeure on gas shipments, with industry sources indicating that normal production levels may take weeks to restore.
Shipping through the Strait of Hormuz, which facilitates nearly one-fifth of global energy consumption, has slowed to a near standstill for the fifth straight day. Britain’s maritime trade monitoring agency reported an explosion near a tanker anchored southeast of Kuwait’s Mubarak Al Kabeer port, adding to security concerns across the Gulf.
Analysts at J.P. Morgan estimated that roughly 329 oil tankers are currently stranded in the Gulf due to heightened risks. While Iran has largely avoided targeting major energy infrastructure, shipping disruptions remain severe.
Energy experts noted that most oil fields in the region could resume operations within days once logistical hurdles are resolved, with full production typically restored within two to three weeks. However, transport bottlenecks and storage limitations remain the key constraints, particularly in Iraq, where maintaining reservoir pressure is essential for output recovery.
