Brent Crude Could Jump By US$20 A Barrel On Monday Amid Reported Closure Of Strait Of Hormuz - Rystad Energy

KUALA LUMPUR, March 1 (Bernama) -- Brent crude oil could jump by around US$20 on Monday as risk premiums are rapidly repriced unless clear and credible signals of de-escalation emerge over the weekend following the US-Israel attack on Iran, research and energy intelligence company Rystad Energy said today.

Its senior vice president and head of geopolitical analysis Jorge Leon said the move would reflect not only the probability of physical disruption following the effective halt of traffic through the Strait of Hormuz, but also the extreme uncertainty surrounding maritime flows, retaliation dynamics and political escalation.

“Should the Strait remain effectively closed or energy infrastructure be confirmed as damaged, the upside risks to prices would increase further,” said Leon in a research note today.

He added that if the Strait of Hormuz were to close, the most likely scenario was that it would be temporary, potentially lasting one to two weeks. 

The Strait of Hormuz, which sits between the Persian Gulf and the Gulf of Oman, provides the only sea passage from the Persian Gulf to the open ocean and is one of the world's most strategically important choke points.

Leon noted that a prolonged closure would carry severe geopolitical consequences and likely provoke a rapid international response.

“That said, even a short-lived disruption would create a significant logistical backlog.

“Tanker congestion, rescheduling of cargoes, and port delays could take several additional weeks to normalise, meaning the market impact would likely persist well beyond the formal reopening of transit lanes,” he added. 

According to Rystad Energy, about 15 million barrels per day of crude oil transit the Strait of Hormuz, representing close to 30 per cent of global seaborne crude trade and making it the most critical oil chokepoint in the world.

Leon said any sustained disruption, formal or de facto, would remove a substantial portion of globally traded crude from the market.

“Whether the Strait is closed by force or rendered inaccessible by risk avoidance, the impact on flows is largely the same. Nations with strategic petroleum reserves may take action and release volumes if the disruption of the Strait risks being extended.

“Unless de-escalation signals emerge swiftly, we expect a significant upward repricing of oil at the start of the week,” he added. 

Leon noted that at present, there were no signs of de-escalation and the diplomatic track appeared effectively stalled, while the risk profile had shifted from contained military exchange toward systemic disruption risk. 

“Going forward, the most critical indicators to monitor include any reopening of diplomatic channels, the reaction of Gulf Cooperation Council (GCC) governments following direct attacks on their territory, confirmation regarding the reported deaths of senior Iranian leaders and Tehran’s official posture, any verified targeting of energy infrastructure, and real-time maritime traffic patterns through the Strait of Hormuz,” he added.

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