Kamal Ghorui
Oil prices surged sharply on Monday after tensions in the Middle East intensified and the strategically crucial Strait of Hormuz continues to stay shut, with disruptions now having crossed 70 days. Meanwhile, the Middle East conflict has continued to intensify as US President Donald Trump rejected Tehran’s response to Washington’s peace proposal and Iran issued fresh threats of violence in the Strait of Hormuz, reigniting fears over global energy supply routes.Brent crude, the international benchmark for oil, climbed 2.69% to $104.01 a barrel for July delivery. US benchmark West Texas Intermediate (WTI) rose 2.54% to $97.84 a barrel.The rally came as hopes of an imminent end to the 10-week-long US-Iran conflict faded. Trump on Sunday described Iran’s response to a US-backed peace proposal as “unacceptable”, effectively dampening expectations of breakthrough talks that could have restored stability to oil flows through the strategic Strait of Hormuz.Attention has now shifted to Trump’s upcoming visit to Beijing on Wednesday, where he is scheduled to meet Chinese President Xi Jinping. US officials said discussions are expected to focus on trade ties between the two nations and the Iran situation.“Market attention now shifts squarely to President Trump’s visit to China this week,” IG market analyst Tony Sycamore said in a note. “There is hope he can persuade Beijing to leverage its influence over Iran to push for a comprehensive ceasefire and a resolution to the ongoing disruption in the Strait of Hormuz.”Adding to supply concerns, Saudi Aramco chief executive Amin Nasser warned on Sunday that the global market has already lost around one billion barrels of oil over the past two months. He cautioned that even if supply normalises, energy markets would take time to stabilise.Meanwhile, shipping data from Kpler indicated that at least two crude-laden tankers crossed the Strait of Hormuz last week with their tracking systems switched off, a growing tactic aimed at avoiding potential Iranian attacks and keeping Middle East oil exports moving despite heightened risks.Oil prices have continued to be volatile since the US and Israel launched joint strikes on Iran. After the attack, Tehran retaliated by tightening its noose on the strategically crucial Strait of Hormuz, world’s oil pipeline that carries 20% of global energy supplies.
