G7 Energy Ministers Set to Convene Amid Oil Market Turmoil Over Strait of Hormuz Closure

Crude oil futures surged past $100 per barrel on Tuesday, with the New York-traded CL=F contract reaching $102.45 amid growing concerns over supply disruptions in the Middle East. The closure of the Strait of Hormuz—a vital maritime chokepoint through which approximately 20% of global oil shipments pass—has been sustained due to heightened Iranian military posturing and threats against commercial vessels. This development has intensified fears of a global supply crunch, especially as geopolitical tensions in the region remain unresolved. The G7 energy ministers are convening in an emergency session to deliberate coordinated action, including the potential release of strategic petroleum reserves. While no specific volume has been disclosed, market analysts estimate that a combined release of 50 million barrels across member nations could help stabilize prices. Major oil producers, including ExxonMobil (XOM), are closely monitoring the situation, with the company's stock experiencing a 2.3% uptick on speculation of elevated crude demand and pricing power. The broader market reacted with heightened volatility, as the CBOE Volatility Index (^VIX) spiked to 27.8, reflecting increased investor anxiety. Energy sector ETFs and related equities have shown sharp swings, with the S&P 500 Energy Sector Index dropping 3.1% on Monday before recovering slightly. Analysts warn that prolonged closure of the strait—coupled with policy uncertainty—could sustain oil prices above $100 for weeks, impacting inflation forecasts and central bank monetary policy decisions.