Oil prices have surged to their highest level in two weeks, with Brent crude reaching $78–$79 per barrel and WTI at $73–$74, marking the largest two-day percentage gain since April. This rally comes amid escalating tensions between the U.S. and Iran, raising concerns over potential disruptions in oil supply, particularly through the crucial Strait of Hormuz. The recent developments follow the end of a fragile ceasefire, with U.S. President Donald Trump declaring the truce over and threatening further military action. This geopolitical strain has led to heightened fears of supply disruptions, which could drive oil prices even higher, potentially approaching $90 per barrel.

Key Takeaways

• Pricing suggests the recent oil price surge is consistent with increased likelihood of reaching new all-time highs.
• The market appears to view heightened U.S.-Iran tensions as supportive of further price increases through July 2026.
• Current odds reflect an increased expectation of oil prices hitting significant benchmarks, such as $90 in July.

What to Watch

Watch for further developments in U.S.-Iran relations, especially actions affecting the Strait of Hormuz, which could drive significant shifts in oil market pricing. Any announcements from OPEC regarding production adjustments could also influence price expectations. The International Energy Agency’s reports on global oil inventories and demand will be closely monitored for indications of future price movements.

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