Following US and Israeli strikes on Iran, concerns have grown that the Strait of Hormuz could face disruption — a development analysts warn could push oil prices toward $100 per barrel.
According to the report by Reuters, tanker operators and major energy firms have temporarily suspended shipments of crude, refined fuels and liquefied natural gas through the waterway after Tehran cautioned vessels about transiting the area.
Markets are already reacting. The VIX volatility index has risen sharply in 2026, while investors are shifting toward safe-haven assets such as the Swiss franc amid fears of broader instability. That choke point matters because more than 20% of global oil flows through the strait, making shipping decisions as consequential as the battlefield headlines.
Oil Prices Poised For Triple-Digit Surge
Director of energy and refining at ICIS Ajay Parmar told Reuters the biggest lever for crude is whether Hormuz is closed, not simply the airstrikes themselves. He said that he expects the market to reopen much nearer $100 a barrel, with the potential to push beyond that level if the disruption lasts.
According to Helima Croft of RBC, Middle East leaders have warned Washington that a war involving Iran could send prices above $100, and Barclays analysts also flagged the same triple-digit risk.
From the broader market perspective, the same shock has traders tracking cross-asset spillovers that have already been amplified this year by tariff-related turbulence and a sharp tech selloff, alongside the VIX rise and a MOVE index gain of about 15%.
Will The Strait Of Hormuz Remain Open?
On Sunday, OPEC+ decided to raise output by 206,000 barrels per day beginning in April — a relatively modest increase representing less than 0.2% of worldwide oil consumption, reports Reuters.
However, analysts warn that any disruption to flows through key routes would far outweigh that supply boost. Even with contingency measures such as Saudi Arabia’s East-West pipeline and an alternative route via Abu Dhabi, consultancy Rystad estimates a potential shortfall of 8 to 10 million barrels per day in the event of a shutdown, according to Reuters.
Jorge Leon, an energy economist at Rystad, told the outlet that oil prices could surge by about $20 once markets reopen, potentially lifting Brent crude to roughly $92 per barrel.
Beyond crude itself, Asian governments and refiners have been reviewing inventories and contingency plans for shipping lanes and replacement barrels, according to Reuters.
Geopolitical Tensions Threaten Oil Stability
This situation is underscored by recent assessments from the CIA, which have previously discussed scenarios where the Iranian Islamic Revolutionary Guard Corps may maintain power even if Supreme Leader Ayatollah Ali Khamenei is removed. This backdrop raises significant concerns for oil markets, particularly as tensions escalate around the Strait of Hormuz, a critical chokepoint for global oil supply.
With approximately 20% of the world’s oil passing through this route, the potential for conflict could disrupt tanker traffic and push Brent crude prices significantly higher, with estimates suggesting a potential rise toward $100 per barrel if disruptions occur. As geopolitical risks intensify, analysts are closely monitoring how these developments may influence the broader energy landscape and global inflationary pressures, making OPEC+ decisions especially consequential.
How Geopolitical Tensions Shift Market Dynamics
Currency trading has also become part of the oil story, with analysts at Commonwealth Bank of Australia pointing to last June’s conflict, when the U.S. dollar slipped about 1% before rebounding within days.
Those analysts said a longer fight that materially squeezes supply could instead underpin the dollar against most peers, while the yen and Swiss franc could prove more resilient.
The Swiss franc has already strengthened about 3% against the dollar in 2026, a move that could intensify and complicate decision-making for the Swiss National Bank.
Risk pricing has also shown up in other hedges, with gold up about 22% this year and U.S. Treasury demand in focus as yields have eased in recent weeks, while bitcoin has not acted like a refuge asset, falling 2% on Saturday and down more than 25% over the past two months.
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