Oil Prices Cross $120 Per Barrel As U.S. Tightens Pressure On Iran

Brent crude oil prices climbed above $120 per barrel for the first time since June 2022 after the U.S. expanded pressure on Iran and signalled continuation of its naval blockade around Iranian ports.

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Brent crude rose more than 6% to trade near $120 per barrel, while West Texas Intermediate crude traded above $107 per barrel. The sharp rise followed statements from U.S. President Donald Trump, who said the naval blockade on Iran would remain in place until a nuclear agreement is reached with Tehran.

The latest escalation added to concerns over supply disruptions in the Middle East, especially around the Strait of Hormuz, one of the world’s most critical oil transit routes.

U.S. Expands Action Against Iran

The U.S. administration is seeking forfeiture of two Iran-linked oil tankers seized during enforcement of the blockade, according to official developments reported on Wednesday.

The U.S. military has also requested deployment of hypersonic missiles to the Middle East, marking the first planned deployment of the weapons in the region.

The White House said President Trump discussed measures to continue the blockade while reducing the impact on American consumers during a meeting with oil and trading executives.

Iranian officials continued to reject U.S. demands. Iranian military adviser Mohsen Rezaee said the country would respond if the blockade continues, according to Iranian state television.

Strait Of Hormuz Disruption Impacts Supply

The Strait of Hormuz has remained heavily disrupted since the conflict intensified in late February. The route handles nearly 20% of global crude oil shipments and significant volumes of liquefied natural gas.

According to the International Energy Agency, the ongoing disruption represents one of the biggest supply shocks faced by global energy markets.

Energy trader Vitol Group estimated the market is facing supply losses of nearly 1 billion barrels due to reduced movement through the region.

The U.S. has reportedly turned away dozens of ships since April 13 as part of the blockade measures.

Global Oil Markets React

Oil market indicators pointed to tighter supply conditions globally. The gap between Brent crude December contracts widened to more than $10 per barrel compared with nearly $3 two months earlier.

U.S. crude exports also climbed to record levels last week as buyers increased purchases from American producers to replace disrupted Middle East supply. Exports crossed 6 million barrels per day, surpassing the previous record of nearly 5.3 million barrels set in 2023.

The U.S. administration has also approached other countries to support an international coalition aimed at enabling safe navigation through the Strait of Hormuz, according to reports.

The most recent rise in crude oil prices comes at a time when the Middle East is still unstable and global energy supply chains are under more stress.