Brent crude jumped 7.6% to $108.81 per barrel on Thursday after US President Donald Trump vowed to continue strikes on Iran, raising fears of prolonged disruptions to oil supply. WTI rose 7.1% to $107.18. Both benchmarks remain below their conflict highs of over $119.
IEA Executive Director Fatih Birol warned that oil supply disruptions from the Middle East will double in April compared to March. The loss of oil in April will be twice the loss in March, on top of LNG disruptions, feeding into inflation and cutting economic growth across multiple countries.
More than 12 million barrels of oil have been lost since the start of the US-Iran conflict due to attacks on energy assets and Strait of Hormuz shipping restrictions. The IEA has already coordinated a record 400 million barrel emergency reserve release and is considering further action.
Jet fuel and diesel shortages are already affecting Asian markets. Birol warned Europe would face similar shortages by April or May. The current disruption is now assessed as worse than the combined impact of the 1973 and 1979 oil crises and the loss of Russian gas following the 2022 Ukraine invasion.
Meanwhile, 26 Korean vessels remain stranded near the Strait. Iran has allowed selective passage for ships from China, Russia, and the Philippines. Japan secured transit through high-level diplomatic channels. A British-led virtual meeting of 30+ nations convened Thursday to explore diplomatic and political options for restoring freedom of navigation.