Gotrade News - Global crude oil prices held above $90 per barrel on Wednesday (April 22) after surging more than 2% in the previous session. US-Iran geopolitical tensions and the ongoing Strait of Hormuz blockade remain the primary drivers.
Key Takeaways:
- WTI rose 2.81% to $92.13 and Brent gained 3.14% to $98.48 per barrel
- Supply disruptions estimated at 4 million barrels daily, potentially rising to 5 million barrels or 5% of global supply
- Trump extended the ceasefire but Iran's Hormuz blockade remains in place
West Texas Intermediate (WTI) closed at $92.13 per barrel, up 2.81% in a single session. Brent crude posted a sharper 3.14% gain to $98.48 per barrel.
The price surge was triggered by US Vice President JD Vance cancelling his planned Pakistan visit for second-round negotiations with Iran. Iran communicated through Pakistani intermediaries that it would not attend the Islamabad meeting.
Iran also stated it would not reopen the Strait of Hormuz while the US Navy continues intercepting vessels entering and exiting Iranian waters. This critical shipping lane typically carries one-fifth of global crude oil supply.
Current supply disruptions are estimated at 4 million barrels per day, according to analyst data. This figure could rise to 5 million barrels, approximately 5% of global supply, with Asia being the most affected region.
President Donald Trump announced an extension of the ceasefire while maintaining the blockade against Iran-linked vessels. Oil market volatility has reached its highest levels since the 2020 Covid-19 pandemic.
Rebecca Babin, senior energy trader at CIBC Private Wealth Group, noted that oil distribution remains constrained despite rapidly arriving news. Goldman Sachs flagged "two-way risks" due to elevated global uncertainty.
Oil prices could correct if conflict de-escalation or energy distribution recovery occurs. However, as long as the Strait of Hormuz remains closed, upward price pressure is expected to persist.
Sources: Kabar Bursa, Bloomberg Technoz, Kompas
