Oil prices spiked sharply after a U.S. strike on Iranian nuclear sites, rattling global markets and raising fears of supply disruptions through the Strait of Hormuz.
At a Glance
- U.S. airstrikes targeted Iran’s Fordow, Natanz, and Isfahan nuclear facilities, driving Brent crude prices to a five-month high
- Iran’s parliament voted to authorize closure of the Strait of Hormuz, a chokepoint for about 20% of global oil shipments
- Brent crude spiked near $80 per barrel; analysts warn prices could top $100 if Hormuz is blocked
- U.S. energy independence limits domestic risk, but global supply remains vulnerable amid tight OPEC spare capacity
- U.S. gasoline prices are expected to rise ahead of July 4 travel season as tensions escalate
Strikes Trigger Sharp Oil Rally
The U.S. launched Operation Midnight Hammer on June 22, striking Iran’s Fordow, Natanz, and Isfahan nuclear facilities. Global markets reacted swiftly: Brent crude surged near $80 per barrel—its highest in five months—before settling between $76–78.
According to MarketWatch, RBC’s Helima Croft warned, “Geopolitical risk premiums are back in a big way,” as traders priced in potential regional escalation.
Strait Of Hormuz In The Spotlight
Iran’s parliament voted to authorize closure of the Strait of Hormuz, through which nearly one-fifth of global oil transits daily. While the measure awaits final approval from Iran’s Supreme National Security Council, even symbolic moves have rattled traders.
Analysts from Goldman Sachs and JPMorgan predict Brent crude could surge past $100 per barrel if full or even partial closure of Hormuz is implemented.
Supply Buffer, But Not Invulnerable
While the U.S. is now a net energy exporter, global spare production capacity —primarily held by Saudi Arabia and the UAE—is limited to roughly 5.7 million barrels per day. That cushion may prove inadequate if maritime flows through Hormuz are significantly disrupted.
At present, market risk premiums have risen roughly $12 per barrel, reflecting concern over sustained instability.
Consumers Set For Higher Prices
American drivers will likely feel the impact in coming weeks. National gasoline prices, already trending upward, are expected to climb an additional 5–6% heading into the July 4 holiday period, with national averages approaching $3.40 per gallon.
The market’s next moves hinge on Tehran’s follow-through—or reversal—on its Hormuz threat. Until clarity emerges, global trade and consumer prices will remain exposed to further volatility.
