West Texas Intermediate (WTI) crude oil futures on NYMEX rose by 2% to approximately $93.70 during Thursday's European session, driven by the ongoing closure of the Strait of Hormuz, a critical passage for nearly 20% of global energy supply [1]. The closure persists despite a ceasefire extension between the United States and Iran, with the Strait remaining under the control of the Iranian military as retaliation for the US blockade of Iranian sea ports [1]. On Tuesday, US President Donald Trump stated that military attacks on Iran would remain on hold until Washington receives a unified proposal [1]. Earlier, Iranian media reported that the Islamic Revolutionary Guard Corps (IRGC) fired on three ships in the Strait and escorted two of them into Iranian waters, as confirmed by The Wall Street Journal [1].
Rabobank’s Global Strategist Michael Every highlighted that the conflict around Iran and disruptions in the Strait of Hormuz could significantly prolong the timeline for energy market normalization, potentially extending into Q4 [2]. He noted that clearing potential mines from the Strait could take weeks to months, depending on the extent of mining, and that the marine drones currently being used are relatively untested compared to traditional minesweeping methods [2]. Every emphasized that futures markets are materially underpricing the real supply risks facing both crude oil and natural gas [2]. Additionally, the ongoing Iran conflict has driven Panama Canal lane prices to record highs—up to five times pre-war levels—as Asian LNG importers compete for access [2].
From a technical perspective, WTI remains in a constructive near-term posture, trading above the 20-day Exponential Moving Average (EMA) at $90.96 and within an ongoing uptrend from $76.42 [1]. The Relative Strength Index (RSI) stands at 54, indicating a resumption of the upside trend after a correction [1]. Key resistance is noted near $100.39, with immediate support at the 20-day EMA; a close below this level could trigger a deeper pullback toward $79.61 [1].
Both sources underscore the heightened supply risks and market volatility stemming from the Hormuz situation. While WTI prices have responded with a notable increase, Rabobank warns that futures markets may not fully reflect the ongoing risks, suggesting further price volatility and potential upside if the disruption persists [2].
CONCLUSION
The closure of the Strait of Hormuz has driven WTI oil prices higher and raised significant concerns about global energy supply security. Analysts warn that the market may be underestimating the duration and impact of the disruption, with risks potentially extending into Q4. Investors should remain alert to further volatility and possible price increases if the situation remains unresolved.