Institution Warns: If the Hormuz Crisis Continues, Oil Prices Could Spike to $150

BlockBeats News, April 28th, as the US-Iran negotiations remain deadlocked and transportation in the Strait of Hormuz is disrupted, international oil prices strengthened again, with WTI crude oil surpassing the $100 mark and both WTI and Brent crude rising over 2% intraday.

According to the White House, US President Trump and the national security team have reviewed Iran's latest proposal. Iran hopes to restart shipping in the Strait of Hormuz in exchange for the US lifting the port blockade and ceasing hostilities. However, Trump has stated that sanctions will only be eased once the agreement is "100% implemented," and currently, the two sides have not reached a consensus.

PVM Oil Associates' senior analyst Tamas Varga warned that if the conflict persists, oil prices breaking $150 is "not impossible." He pointed out the current global lack of sufficient alternative energy sources to fill the supply gap. If the supply disruption prolongs, the supply loss will exceed the impact of demand contraction.

President of Lipow Oil Associates, Andy Lipow, also stated that even if the conflict ends immediately, it will take several months to clear mines, clear tanker congestion, and resume production. It is anticipated that the oil market will need at least 4 to 6 months to stabilize.

Meanwhile, several Wall Street institutions have simultaneously lowered their oil market recovery expectations. Goldman Sachs has delayed the Gulf energy export restoration to the end of June, and Citigroup projects that if the closure of the Strait of Hormuz continues until the end of June, Brent crude prices could rise to $150 per barrel.