Oil prices soared more than 6 percent on Wednesday amid fears of prolonged supply disruption in the Strait of Hormuz and a lengthy US siege of Iranian ports. US crude settled up 6.95% at $106.88 per barrel, while Brent crude, the international benchmark, rose 6.08% to $118.03, its highest since June 2022. Brent futures continued climbing on Thursday to $119.94 per barrel.

The price surge comes as Iranian forces maintain a blockade on vessel transit in the Strait of Hormuz, and the US regime besieges Iranian ports and shipping. A White House official confirmed that US President Donald Trump met with oil company executives to discuss ways to mitigate the impact of a potentially months-long siege of Iranian ports and minimize effects on American consumers.

The Pentagon revealed for the first time that the war on Iran has cost the US military $25 billion so far. IG market analyst Tony Sycamore noted that “prospects for any near-term resolution to the Iran conflict or a reopening of the Strait of Hormuz remain dim.”

Al Jazeera’s Barnaby Lo, reporting from Seoul, said almost the entire Asia Pacific region depends on oil imports, with much coming from the Middle East. Brent crude touching $120 a barrel will have a huge impact, and the Asian Development Bank has already cut its growth forecast for the region from 5.1% to 4.7%.

President Trump also welcomed the UAE’s withdrawal from OPEC, calling it “great” and saying it would help lower gasoline prices. The UAE announced it would leave OPEC and OPEC+ effective May 1. However, experts say the move is unlikely to have an immediate market impact because UAE exports are currently constrained by Iran’s control of the Strait of Hormuz. Analysts from Wood Mackenzie noted that Gulf countries will take months to return to pre-war production volumes.

Source: www.aljazeera.com