US crude rises over 11%, Brent up nearly 8% after Trump threatens more Iran attacks

HOUSTON: US oil prices jumped sharply on Thursday, with Brent crude rising nearly 8% and West Texas Intermediate (WTI) crude up more than 11%. Traders worried about ongoing disruptions to oil supply after President Donald Trump said the United States would continue attacks on Iran.

Brent crude futures LCOc1 closed $7.87, or 7.78%, higher at $109.03 a barrel. WTI futures CLc1 rose $11.42, or 11.41%, to $111.54 per barrel — marking the biggest one-day rise in price since 2020. Both benchmarks, however, remained below earlier highs near $120 a barrel.

Trump said military operations would be intensified, but gave no timeline for ending hostilities or reopening the Strait of Hormuz. “We’re going to hit them extremely hard over the next two to three weeks,” Trump said. “We’re going to bring them back to the Stone Ages, where they belong.”

Iran is drafting a protocol with Oman to monitor traffic in the strait, an Iranian foreign ministry official said. Iran has effectively shut down the narrow waterway, through which a fifth of global oil and liquefied natural gas is shipped, in retaliation for US-Israeli strikes that began on February 28. Reopening it is a priority as energy prices rise.

“The real question on traders’ minds is that if Iran’s oil infrastructure is possibly now at risk, and with more damage in the area now very likely, even if left intact the restart of oil flows in the region (is) now looking to be delayed further,” said Dennis Kissler, senior vice president of trading at BOK Financial.

WTI, usually priced below Brent, traded nearly $3 higher than Brent for May deliveries, marking the largest premium in a year. “Market’s expectation is that if (the) Strait of Hormuz opens up in (a) couple of weeks this risk premium will immediately go down,” said John Kilduff, Partner at Again Capital.

Federal Reserve Bank of Dallas President Lorie Logan said that a swift resolution could mean “economic impact could be pretty moderate,” though the outlook remains uncertain.

Citi expects Brent crude prices to average $95 a barrel in the base case and $130 a barrel in a bull case for the second half of the year. JP Morgan said oil could climb to between $120 and $130 a barrel soon, and could rise above $150 if the Strait stays closed into mid-May.

US oil rigs rose by two to 411 this week, according to Baker Hughes. Producers are considering adding more rigs if high prices continue.

Britain is hosting a virtual meeting of around 40 countries to discuss reopening the Strait of Hormuz, while the US is not attending. OPEC+ may decide on further oil output increases this Sunday to prepare for more supply if the strait reopens.

In addition, Ukraine’s strikes on Russian port infrastructure, pipelines, and refineries have reduced export capability by 1 million barrels per day — about a fifth of total capacity. The International Energy Agency said supply disruptions could start affecting Europe’s economy in April, even though the region had been protected by cargoes contracted before the war.