Global oil prices surged as tensions escalated prior to the deadline set by Donald Trump for Iran. The US President issued a stark warning on social media, threatening dire consequences unless Iran ceased its threats against ships passing through the Strait of Hormuz.
Trump’s ultimatum, scheduled for 8pm Eastern Time (1am Wednesday UK time), coincided with US military strikes on Iran’s Kharg Island, a key oil export hub. The focus of the ultimatum was on Iran’s crucial infrastructure, including power plants.
In response to the heightened geopolitical risks, Brent crude oil prices climbed to $110 per barrel, with US West Texas Intermediate crude nearing a four-week high at $115.3 per barrel. Stock markets reacted nervously, with the UK’s FTSE 100 index plummeting over 80 points, erasing £19 billion in market value.
The Strait of Hormuz, responsible for shipping approximately one-fifth of global oil supply, remained effectively closed due to ongoing military actions by the US and Israel since late February.
The energy analyst at trading platform IG, Axel Rudolph, highlighted market anxiety as the deadline approached, emphasizing the critical role of the Strait of Hormuz in global oil transport.
Meanwhile, a top official from the International Energy Agency warned of the unprecedented energy shock caused by the Iran crisis, surpassing past oil crises like those in 1973, 1979, and 2002 combined.
In the UK, consumers faced rising fuel prices over the Easter weekend, with average unleaded and diesel prices climbing. The AA noted a narrowing price gap between supermarket fuel and other stations, attributing the trend to competitive pricing strategies.
Luke Bosdet from the AA expressed concerns over the disparity in fuel prices across different regions, highlighting the challenges faced by UK drivers in finding affordable fuel options in a market influenced by supermarket pricing.
