- Analysts at ING Think explained why crude oil prices have continued to rise despite a record release of 400 million barrels coordinated with the IEA.
- ING Think analysts added that there are concerns about the speed at which this oil will reach the market and whether it will be enough to tie up the market until oil begins flowing through the Strait of Hormuz again.
- Iran has also reportedly refused negotiations amid ongoing attacks from the United States and Israel against the country.
Iranian Parliament Speaker Mohammad Bagher Ghalibaf on Thursday warned against any aggression toward the country’s islands.
“Homeland or Death! Any aggression against soil of Iranian islands will shatter all restraint. We will abandon all restraint and make the Persian Gulf run with the blood of invaders,” Ghalibaf said in a post on X.
This comes amid a rise in Iranian attacks on oil tankers in the Middle East and the Strait of Hormuz, including one near Iraq on a tanker owned by the U.S.
Analysts Explain Why Crude Oil Is Still Boiling
Analysts at ING Think explained why crude oil prices have continued to rise despite a record release of 400 million barrels coordinated with the International Energy Agency.
“There are no signs of de-escalation in the Persian Gulf, so there is no end in sight to the disruptions to oil flows through the Strait of Hormuz,” the firm stated in a recent note.
ING Think analysts added that there are concerns about the speed at which this oil will reach the market and whether it will be enough to tie up the market until oil starts flowing through the Strait of Hormuz again.
“The only way to see oil prices trade lower on a sustained basis is by getting oil flowing through the Strait of Hormuz. Failing to do so means that the market highs are still ahead of us,” the analysts added.
U.S. West Texas Intermediate (WTI) crude futures maturing in April rose more than 4% to $91. Brent crude futures expiring in May also surged about 5% to hover around $96.5 a barrel.
The United States Oil Fund ETF (USO) was up over 3%, while the ProShares Ultra Bloomberg Crude Oil ETF (UCO) was up more than 2% at the time of writing.
Iran Refuses Negotiations Amid Ongoing Attacks
Iran has also reportedly refused negotiations amid ongoing attacks from the United States and Israel against the country.
According to a report by Al Jazeera referring to the statements coming from Iran, the country is opposed to talks in the current scenario.
Earlier this week, Defense Secretary Pete Hegseth warned of the “most intense” day of strikes on Iran on Tuesday, while not ruling out the possibility of U.S. boots on the ground.
IEA Warns Of ‘Largest Supply Disruption’
Meanwhile, the IEA warned of the “largest supply disruption” in the global oil market amid a near-halt in traffic through the Strait of Hormuz, which otherwise accounts for nearly a fifth of global crude oil shipments.
“Widespread flight cancellations in the Middle East and large-scale disruptions to LPG supplies are expected to curb global oil demand by around 1 mb/d during March and April compared to previous estimates. Higher oil prices and a more precarious outlook for the global economy pose further risks,” the agency said.
Meanwhile, U.S. equities declined in Thursday’s pre-market trade. At the time of writing, the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, was down 0.38%; the Invesco QQQ Trust ETF (QQQ) fell 0.33%; and the SPDR Dow Jones Industrial Average ETF Trust (DIA) declined 0.51%. Retail sentiment on Stocktwits regarding the S&P 500 ETF was in the ‘bearish’ territory.
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