Oil prices swing as analysts cite Hormuz closure

Oil prices are continuing to swing during the US-Iran clash, with analysts pointing to the partial closure of the Strait of Hormuz, shifting statements from President Donald Trump and pressure on refined fuels including diesel and gasoline.

Jim Burkhard, head of global energy crude oil research at S&P Global, said surprises were shaking the market and called the Hormuz closure a shock. Bob McNally, president of the Rapidan Energy Group and a former White House energy adviser, said markets had not expected such a curtailment of the strait.

About 20 million barrels per day of crude normally pass through the Strait of Hormuz, roughly a quarter of global oil demand, according to McNally. He described the current supply shock as “the biggest disruption in history.”

Brent oil prices rose more than 13 percent immediately after the US-Israeli siege against Iran on February 28. Since the start of the fighting, Brent has averaged $94 a barrel, below the $150 level some experts had said was possible.

McNally said one reason prices have not risen further is that markets still believe the crisis could end soon. Optimistic statements by Trump and other administration figures, including Treasury Secretary Scott Bessent, have often pushed oil prices lower, he said.

JPMorgan Chase analysts estimated that the Hormuz closure has lowered volumes by about 12.6 million barrels per day. Lower crude imports from China, releases from commercial and government inventories, and higher output from the United States, Canada and Brazil have helped offset some lost supply.

The International Energy Agency announced in March that member governments would release 400 million barrels of oil, described as the largest emergency stock release in history.

Analysts also warned about pressure on refined products. Burkhard said there was generally enough crude oil available, but not enough refining capacity. Diesel prices have doubled compared with February, while gasoline prices are up about 50 percent.

The conflict has also sidelined some energy infrastructure, including refinery capacity, while analysts also pointed to Russian refinery outages linked to attacks by Ukraine.