Iran war sends US crude futures up 12% a barrel

Published Sat, Mar 7, 2026 · 07:34 AM

[HOUSTON] US crude oil futures climbed more than 12 per cent on Friday (Mar 6), but remained under Brent as buyers sought available barrels, with Middle Eastern supply constrained by the effective closure of the Strait of Hormuz amid the expanding US-Israeli war with Iran.

Brent crude futures settled at US$92.69 a barrel, up US$7.28, or 8.52 per cent. West Texas Intermediate crude (WTI) finished at US$90.90 a barrel, up US$9.89, or 12.21 per cent.

It was the second straight day that gains in US crude futures had outpaced those in the Brent contract.

“Refiners and trading houses are searching for alternative barrels, and the US is the largest producer,” said Giovanni Staunovo, an analyst with UBS. “To prevent inventories in the US from being reduced too quickly via too high exports, the spread is moving back to the transportation costs.”

Janiv Shah, vice-president of oil analytics at Rystad Energy, pointed to several factors for the divergence in gains on Thursday and Friday between WTI and Brent.

“Looks like some potential strength in US Gulf Coast refinery runs on margins and arbs to Europe as well as Washington on futures,” Shah said. Crude oil was set on Friday for its strongest weekly gain since the extreme volatility of the Covid-19 pandemic in the spring of 2020, as conflict in the Middle East kept shipping and energy exports through the vital Strait of Hormuz halted.

Crude over US$100 a barrel?

Qatar’s energy minister told the Financial Times he expects all Gulf energy producers to shut down exports within weeks, a move he said could drive oil to US$150 a barrel, according to an interview published on Friday.

“The worst-case scenario is developing before our eyes,” John Kilduff, a partner at Again Capital, said. “I think the forecasts of US$100 a barrel all are to come to true.” Oil started its steep rally after the US and Israel launched strikes on Iran last Saturday, prompting Iran to stop tankers moving through the Strait of Hormuz.

Oil supply equal to about 20 per cent of world demand usually passes through this waterway each day. With the Strait now effectively closed for seven days, that means about 140 million barrels of oil, equal to about 1.4 days of global demand, has been unable to reach the market.

The conflict has spread across the Middle East’s key energy-producing areas, disrupting output and forcing shutdowns of refineries and liquefied natural gas plants.

“Every day the Strait stays closed, prices will go higher,” Staunovo said. “The belief in the market was that Trump might pull back at some point because he doesn’t want to have high oil prices, but the longer that takes, the clearer it is how much is at risk.” US President Donald Trump said on Thursday that he was not concerned about rising US petrol prices linked to the conflict, saying, “if they rise, they rise”.

The possibility that the US Treasury Department might take action to combat rising energy costs briefly pushed prices down by more than 1 per cent early on Friday. Losses narrowed after Bloomberg News reported that the Trump administration had ruled out using the Treasury Department to trade oil futures. The Treasury on Thursday granted waivers for companies to buy sanctioned Russian oil. The first waivers went to Indian refiners, who have since bought millions of barrels of Russian crude. REUTERS