https://www.barrons.com/articles/crude-oil-price-today-iran-8b57d89d
By Laura Sanicola & Reshma Kapadia
Excerpt: The U.S. and Israeli attack on Iran—and Tehran’s retaliation—is likely to cause oil and other energy prices to spike and stock markets to react sharply when trading starts on Sunday evening.
Iran has reportedly closed the critical Strait of Hormuz, saying ships are “not allowed” to pass, a negative indicator for when oil starts trading on Sunday. Iran’s Supreme Leader Ali Khamenei has been killed, Iranian TV confirmed, well after President Donald Trump later posted about on Truth Social: “Khamenei, one of the most evil people in History, is dead,” Trump said in the post. “This is not only Justice for the people of Iran, but for all Great Americans.”
It is clear that the impact will extend well beyond crude.
Oil prices had been elevated ahead of the attack. Trading opens Sunday evening. The full price impact won’t be known until then, but a Barclays note published Saturday said Brent crude oil could make its way to $100 a barrel “as the market grapples with the threat of a potential supply disruption amid a spiraling security situation in the Middle East.” Reports of two tankers attacked in the Strait of Hormuz might only send them higher.
Eight members of the OPEC cartel, including Saudi Arabia, Russia, and the U.A.E., were set to meet on Sunday, and plan to boost production. If delegates see a sustained supply disruption as likely, they may choose to increase oil output to prevent a major disruption.
Here’s what else to know.
The Strait of Hormuz Is Critical to Energy Markets
Iran is a major oil producer and military power in the Strait of Hormuz. The country pumps roughly 3.3 million to 3.5 million barrels a day, about 3% of the world’s supply. Iran also exerts control over the Strait and appears to be doing so again, putting vast amounts of energy commodities at risk.
About 26% of crude oil goes through the Strait, along with 23% of liquefied natural gas (LNG) and 31% of liquefied petroleum gas and naphtha, according to data from OPIS, a Dow Jones company.
Iran’s export network is anchored by Kharg Island, the main terminal through which most Iranian crude is loaded onto tankers.
Explosions have reportedly been heard at Kharg, located roughly 15 miles off the coast of Iran. About 90% of Iran’s exports go through Kharg, which has a storage capacity of about seven million barrels.
For every day that marine transit is interrupted, the world stops receiving an estimated 20 million barrels/day of crude oil exports and 85 million tonnes per annum of LNG exports, according to OPIS.
The disruption extends beyond crude into another key market: liquefied petroleum gas or LPG. Iran is a major supplier of LPG to China, offering an important alternative to U.S. LPG exports. Any disruption to Iranian LPG exports would have implications well beyond Iran, forcing China to seek replacement supplies from other producers, OPIS reports.
The Strait also represents a critical chokepoint for global gas flows. All LNG exports from Qatar—approximately 20% of global LNG shipping—must transit the Strait, for which there is no viable alternative route. Any disruption, restriction or attempted closure of the Strait would push Middle Eastern LNG supply to the brink, with direct spillover effects for European and Asian gas markets, according to OPIS.
With no spare LNG capacity on hand, Asian buyers would scramble for flexible U.S. cargoes and collide with Europe in the spot
market, OPIS says.
On the production side, Iran’s southwest oil belt in Khuzestan province—including giant fields such as Ahvaz, which produces
750,000 to one million barrels a day—forms the backbone of output. Wells are rarely the immediate constraint, but processing plants, pipelines, and storage facilities in the region represent chokepoints because they are harder to repair quickly. A broader destabilization of the Khuzestan province could put output at risk even without a direct strike on the field itself.
How Might Iran Respond in Ways That Affect Oil Markets?
Even limited threats to shipping in the Strait of Hormuz can lift prices by raising tanker insurance costs and slowing deliveries, effectively tightening supply without removing production.
Iran has never imposed a complete blockage of the strait. Doing so would inflict enormous self-harm: it would cut off China, which imports more than 80% of Iran’s oil exports and far more from Saudi Arabia and the Gulf beyond that. But Iran has repeatedly harassed, threatened, and seized vessels in the strait, most aggressively in 2019 when it impounded the British-flagged Stena Impero and attacked multiple tankers.
A second risk channel runs through Iran’s proxy network. The Houthis in Yemen have demonstrated since 2023 that they can meaningfully disrupt Red Sea shipping, a separate chokepoint handling roughly 12% of global trade. They threatened to retaliate against the U.S. during last June’s nuclear strikes.
What Would a Strike Mean for Oil Prices?
Much depends on how much damage is done to oil infrastructure and whether Iran retaliates against Saudi Arabia and other producers, knocking out some production.
Shipping costs will almost certainly escalate as tankers reroute to the Persian Gulf to avoid the conflict zone.
The “12-day” war in 2025 that targeted Iranian nuclear facilities caused oil prices to spike but since the conflict ended relatively quickly, prices moved back down.
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