Iran has closed the Strait of Hormuz, a critical chokepoint for global oil trade, triggering a rise in crude prices. NYMEX WTI June futures settled at $95.42 a barrel, up 61 cents. The International Energy Agency reports supply disruptions are now underway.
This action comes amid ongoing US-Israel military operations against Iran. Compounding the crisis, Russia's oil export capacity has also been severely reduced due to infrastructure damage.
Prediction markets reflect the heightened tension. The probability of WTI reaching $150 in May has dropped to 3.5%, while the likelihood of hitting $110 stands at nearly 40%. These numbers suggest traders are bracing for prices to climb, but not to extreme highs in the immediate term.
Key factors to watch: Iran's continued control over the strait, potential US-Iran negotiations, and any moves by OPEC+ or the US Treasury regarding production or strategic reserves.