Crude oil prices surge as US-Iran impasse tightens supply globally

Crude oil and gasoline futures climbed sharply on Friday as June WTI (CLM26) rose about $4.25 (+4.20%) and June RBOB gasoline (RBM26) gained around $0.096 (+2.67%), pushing WTI to a one-and-a-half-week high amid renewed supply worries. Market participants cited the tightening physical flows through the Strait of Hormuz as a key driver.

The rally followed a breakdown in expectations for a swift diplomatic resolution between the United States and Iran, with stalled talks keeping the crucial shipping lane effectively constrained. Analysts point to estimates from major investment banks that Persian Gulf output has been curtailed by roughly 14.5 million barrels per day, and that the disruption has already drawn down nearly 500 million barrels from global inventories, with the risk that this could approach one billion barrels in coming weeks. Reuters reporting also highlighted U.S. plans to tap the Strategic Petroleum Reserve and warnings from regional producers about prolonged market instability.

The immediate market impact was higher crude and refined product prices and increased volatility across energy equities and commodity derivatives. With WTI and Brent trading well above $100 in recent sessions, refinery margins and gasoline price expectations were also repriced higher, adding near-term inflationary pressure to transportation fuel markets. Traders noted that the premium for prompt delivery contracts widened as physical availability tightened.

In a broader context, the near‑closure of the Strait of Hormuz represents one of the largest disruptions to seaborne oil flows in recent history and has prompted warnings from the International Energy Agency and other market watchers about sustained undersupply risks. Policy makers and central banks are likely to monitor the developments closely, given the potential pass-through of energy prices to headline inflation and economic activity.

Looking ahead, analysts say prices will remain sensitive to diplomatic signals and any concrete steps to reopen shipping lanes or boost shipments. A genuine breakthrough in talks could trigger sharp downside adjustments, while further escalation or prolonged closures would keep upside pressure on benchmarks. Market participants will watch SPR releases, OPEC output data and on‑the‑ground reports from ship‑tracking sources for signs of relief or further tightening.