Chart of The Day – OIL

Oil prices surged after Donald Trump posted a message on Truth Social suggesting that diplomatic tensions between Washington and Tehran could persist for some time. The president stated outright that Iran “does not know how to sign a non-nuclear deal” and should “get its act together,” which the market interpreted as a signal that the administration does not intend to compromise on issues critical to the opening of the Strait of Hormuz.

The price of Brent crude oil futures rose to $107.84 per barrel. Nearly 20% of global oil and LNG supplies pass through the Strait of Hormuz, and its prolonged closure has pushed the global market into an unprecedented rate of depleting reserves, estimated at 11–12 million barrels per day. Goldman Sachs warns that the global oil market could shift from a surplus of 1.8 million bpd in 2025 to a deficit of 9.6 million bpd in the second quarter of 2026.

The harshness of Trump’s rhetoric aligns with reports in the Wall Street Journal, according to which the president has ordered his advisors to prepare for a prolonged, indefinite blockade of Iranian ports, rejecting both the option of resuming airstrikes and withdrawing from the conflict. Iran’s diplomatic demands include war reparations, the lifting of sanctions, and control over the Strait of Hormuz, making a short-term agreement seem unlikely.

The latest data from the American Petroleum Institute confirms that the closure of the route is translating into real physical shortages, and U.S. crude oil inventories fell by 1.79 million barrels for the second consecutive time. Gasoline reserves have shrunk by over 8.47 million barrels, indicating a deep structural tightening of supply rather than merely a speculative rise in paper prices. Oil prices have surged in recent days and are approaching their recent local highs. If the situation regarding Iran does not improve, it cannot be ruled out that prices could theoretically rise back above $110 per barrel.

Source: xStation