Oil prices surged 5% following Iran's announcement of the closure of the Strait of Hormuz. The Islamic Revolutionary Guard Corps made the declaration in response to recent U.S. military strikes.
The strait is a vital transit point handling about 20% of the world's oil trade. Its closure to all vessels, including oil tankers, has sparked concerns over a potential daily supply reduction of 10 to 11 million barrels.
WTI Crude Oil prices saw notable increases, with Brent crude near $95.40 per barrel and WTI at $92.63 per barrel. Forecasts suggest prices could reach between $120 and $150 per barrel if the blockade persists.
The geopolitical tension is reflected in prediction markets, where the likelihood of WTI reaching $130 by the end of July is currently assessed at 0.7%.
Key actors to watch include the U.S. government, OPEC+, and the Iranian Ministry of Shipping. Statements from these entities, along with any new military or diplomatic actions, will significantly influence market direction.