On Monday morning, oil quotes lost their initial rise and fell below the $90-per-barrel mark. Brent futures dropped to $87.9, while West Texas Intermediate fell to $81.8, although earlier in the session they had reached their highest levels since June. The reversal was driven by statements from Iran’s Ministry of Foreign Affairs about the possibility of resuming talks with the United States, taking into account Tehran’s interests, which eased concerns about disruptions to supplies through the Strait of Hormuz.
The escalation of the conflict in the Middle East continues: the United States has struck Iran for the ninth night in a row, and Kuwait and Bahrain reported new attacks attributed to Iran. In the Persian Gulf and the Gulf of Oman, commercial vessels were targeted, complicating the security of maritime transport. Barclays analyst Amarpit Singh said that in the coming weeks it will become clear what a sustainable level of oil exports from the region looks like, while markets for now are maintaining “extreme optimism” regarding the potential impact on inventories, which at the start of the conflict fell to five-year lows.
In the United States, gasoline prices at filling stations have exceeded the psychological threshold of $4 per gallon. The average retail cost of fuel has risen by more than 30% since late February, when the United States and Israel began a military campaign against Iran. This points to intensifying economic pressure related to energy supplies.
On the currency market, the dollar weakened: the U.S. dollar index fell by 0.1% to 100.69, ending a three-day run of gains. The euro rose to $1.14, the British pound to $1.34, and the yen remained at 162.3. The Australian dollar also strengthened by 0.2%. The decline in demand for risky assets was reflected in the performance of the U.S. currency.
Gold stabilized around $4,018.90 per ounce as investors assessed the Middle East crisis, which pushed oil prices higher. However, an FRS representative said the need for rate hikes to curb inflation can’t be ruled out, which traditionally weighs on precious metals. Analysts note that as long as the war continues, rising oil prices are fueling inflation and putting pressure on gold.
Comments on the news
- Why is the Strait of Hormuz important for global oil supplies, and why is its stability critical for markets? — The Strait of Hormuz is the planet’s strategic “oil valve.” Roughly 20–25% of all global seaborne oil trade passes through it (about 17–21 million barrels per day). Any blockade—or even heightened military tension—in the strait immediately disrupts supply chains, causing oil prices to jump and triggering panic in global markets, because alternative routes (such as pipelines) have limited capacity.
- Why can Iran’s position in talks with the United States directly affect oil prices (for example, through control of production or transit)? — First, Iran is one of the largest holders of proven oil and gas reserves. Second, it controls the northern coast of the Strait of Hormuz and can threaten shipping (mining, attacks on tankers). Third, through its allies (for example, Yemeni Houthis), Iran can indirectly affect transit through the Red Sea and the Bab-el-Mandeb strait. Therefore, the outcome of the talks—tightening sanctions or removing restrictions on Iranian oil exports—is perceived by traders as a signal for price corrections.
- What are the key disagreements between Iran and the Persian Gulf countries (Kuwait, Bahrain) referenced in the context of the attacks? — The main disagreements are tied to territorial disputes (for example, sovereignty over the islands of Abu Musa, the Greater and Lesser Tumbs in the Strait of Hormuz, which Iran has held since 1971), issues of delimiting offshore shelves for oil and gas production (a dispute around the “Arash” / “Dorra” gas field), and competition for regional influence. In addition, Iran accuses the Gulf monarchies of allowing the United States to use their bases for hostile actions—an argument often cited as a motive or context for attacks on sites in those countries.
Full version: برميل النفط دون 90 دولارا والدولار يتراجع جراء تصاعد صراع أمريكا وإيران