Oil Prices Extend Gains Amid Escalating Iran Conflict and Supply Concerns

Crude oil prices extended their upward trajectory as traders reacted to escalating attacks in the Persian Gulf and signals from U.S. President Donald Trump that the U.S. military may soon withdraw from the Iran conflict. Despite the potential for a U.S. exit, the Strait of Hormuz remains largely closed, keeping markets on edge over energy supply disruptions. Brent crude for June delivery rose 1.5% to $105.56 a barrel as of 9:50 ET. Prices surged more than 60% in March, marking the strongest monthly rally since records began in 1988. The May contract settled about 5% higher on Tuesday at $118.35 per barrel. U.S. crude for May delivery climbed 1.5% to $102.92 a barrel, with prices soaring about 51% in March, the best month for West Texas Intermediate since May 2020. The U.S.-Israeli campaign against Iran has triggered severe energy supply disruptions since the war began on Feb. 28. The conflict has effectively halted shipments through the Strait of Hormuz, a critical waterway connecting the Persian Gulf and the Gulf of Oman. Prior to the war, the strait handled 20% of global oil flows. Trump stated on Tuesday that he expected U.S. military forces to leave Iran in 'two or three weeks,' suggesting a potential end to the conflict. He dismissed the need for a negotiated deal, asserting that Iran is now 'much more accessible' and that he had stopped it from acquiring a nuclear weapon. Iran's Revolutionary Guards announced plans to attack U.S. companies in the region, listing 18 firms including Google, Microsoft, Apple, Intel, IBM, Tesla, and Boeing. Analysts suggest that a U.S. withdrawal could be seen as a defeat, potentially prolonging the conflict and further driving up oil prices. Iranian Foreign Minister Abbas Araghchi denied any ongoing negotiations with the U.S., stating that communications remain limited to the Foreign Ministry and security agencies.