Trump's Extended Iran War Threatens 600 Million Barrels of Oil, Spikes Prices

President Donald Trump's recent national address has intensified concerns over a prolonged U.S.-Iran war, sending oil prices soaring and exacerbating global energy supply disruptions. The market had hoped for a clear exit strategy from the conflict, but Trump's statement that the war will continue for weeks and his vow to strike Iran 'extremely hard' has deepened uncertainty. Ryan McKay, senior commodity strategist at TD Securities, highlighted the grim outlook, noting that nearly 1 billion barrels will be lost by the end of April, including up to 600 million barrels of crude oil and 350 million barrels of refined products. Rapidan Energy forecasts a total net loss of 630 million barrels of oil and products by the end of June, factoring in redirected flows, emergency stockpile releases, and inventory drawdowns. U.S. crude oil prices have surged more than 10% to exceed $110 per barrel, while Brent prices, the international benchmark, have jumped over 6% to surpass $107. Analysts warn that the prolonged conflict and the closure of the Strait of Hormuz, a vital sea route for 20% of global oil supplies, could lead to further price volatility. Trump's refusal to outline a plan to reopen the strait has left buyers scrambling, with physical U.S. oil in Houston trading at a $5.50 premium over the May futures contract. The market is now pricing in the long-term impact of the war, with Matthew Bernstein of Rystad Energy noting that even after the conflict ends, prices will remain supported by increased demand for stockpiling, higher insurance and freight costs, and a broader geopolitical risk premium. As oil stockpiles face pressure and onshore inventories could fall to multi-year lows by August, the global market braces for continued physical tightness and heightened volatility.