Global crude oil prices fell on Monday with Brent trading around $101 a barrel while WTI fell to $94. The decline came amid the Trump administration's aggressive efforts to mobilize international allies to control security in the Strait of Hormuz, a maritime route that carries 20% of the world's oil supply.
The US administration confirmed that it was allowing Iranian tankers to pass through the strait under surveillance to ensure the continuity of global supplies. However, President Trump maintained military pressure with a stern warning to destroy Iran's oil export infrastructure on Kharg Island if disruptions to commercial shipping continue.
The conflict has triggered the largest oil supply disruption in history, forcing more than 30 countries under the coordination of the IEA to release 400 million barrels of strategic reserves. The drastic move is intended to stabilize a market that has seen prices rise by up to 40% since the war began.
Analysts at JPMorgan have warned that any direct attack on Iran's main export terminal could immediately halt the flow of 1.5 million barrels of oil per day. This situation would likely trigger a more powerful response from Tehran that could further cripple energy infrastructure in the Gulf region.
While emergency reserves are starting to be released in Asia, the U.S. Energy Secretary said there was no guarantee that prices would fall any time soon. The uncertainty of war makes energy markets highly sensitive to any military developments in Kharg Island and the Strait of Hormuz.
