\n<\/p>\n
The global oil price hit $126 a barrel on Thursday, its highest level since 2022, after Donald Trump said the US blockade of Iranian ports could last for months and peace talks remained stalled.<\/p>\n
After surging more than 13% in 24 hours, the price of Brent crude futures reached its highest price since the war began on 28 February. Not since Russia\u2019s 2022 invasion of Ukraine has Brent topped $120, with the price then peaking at $139.<\/p>\n
Oil markets have been spooked this week as Trump appeared willing to maintain the US navy\u2019s blockade of Iranian ports, with Iran responding by keeping the strait of Hormuz all but shut to other oil tankers.<\/p>\n
Market observers believe that traders are beginning to look beyond the early optimism that a diplomatic resolution could restore Gulf oil flows through the vital trade route, and towards \u201cthe reality of the supply situation\u201d.<\/p>\n
\u201cThe breakdown of talks between the US and Iran, along with President Trump reportedly rejecting Iran\u2019s proposal for a reopening of the strait of Hormuz, has the market losing hope for any quick resumption in oil flows,\u201d Warren Patterson, the head of commodities strategy at the investment bank ING, said.<\/p>\n
Oil later fell back from its four-year high, to about $114 a barrel on Thursday afternoon.<\/p>\n
A graph showing daily changes to the price of Brent crude since the start of the Iran war<\/p>\n
Trump told oil executives this week that the US would \u201ccontinue the current blockade for months if needed\u201d, according to a White House official.<\/p>\n
US officials hope the blockade will force Iran to cap its oil wells and shutter production once its oil facilities, such as Kharg Island, have filled to the brim.<\/p>\n
\u201cThe blockade is somewhat more effective than the bombing,\u201d Trump told Axios. \u201cThey are choking like a stuffed pig.\u201d<\/p>\n
The sharp rise in oil prices has raised the risk of a global recession fuelled by the rising cost of fuels and industrial feedstocks.<\/p>\n
The economist Paul Krugman, a former New York Times columnist, said he believed most analysts had been \u201cfar too sanguine\u201d about the effects of a prolonged Hormuz crisis.<\/p>\n
\u201cIn my view, a full-on global recession is more likely than not if the strait remains closed for, say, another three months, which seems all too possible,\u201d he wrote on his Substack on 20 April.<\/p>\n
Jim Reid, a market strategist at Deutsche Bank, said there were now \u201cgrowing fears about an extended stagflationary shock\u201d, leading to higher interest rates \u2013 or yields \u2013 on government bonds.<\/p>\n
\u201cOvernight we\u2019ve seen Japan\u2019s 10-year yield move up to 2.51%, which would be its highest closing level since 1997. It was a similar story in Europe too, with the 10-year [German] bund yield at a post-2011 high of 3.11%, whilst 10-year [UK] gilt yields hit a post-2008 high of 5.07%,\u201d Reid added.<\/p>\n
US inflation soared in March, with prices up 3.3% over the year. Meanwhile, Britain is facing a \u00a335bn economic hit and the risk of a recession in 2026 because of the war, a thinktank has said.<\/p>\n
Without an end to the oil market\u2019s biggest supply crisis in history oil prices could return to all-time record highs of about $147 reached in 2008. Tehran said two weeks after shutting the strait that the world needed to prepare for $200 barrels of oil.<\/p>\n","protected":false},"excerpt":{"rendered":"
The global oil price hit $126 a barrel on Thursday, its highest level since 2022, after Donald Trump said the US blockade of Iranian ports could last for months and peace talks remained stalled. After surging more than 13% in 24 hours, the price of Brent crude futures reached its highest price since the war<\/p>\n","protected":false},"author":1,"featured_media":48938,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49],"tags":[1747,17616,1404,1123,84,855,268,1319,11417,81,1060],"class_list":{"0":"post-48937","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-barrel","9":"tag-blockade","10":"tag-economy","11":"tag-global","12":"tag-iran","13":"tag-months","14":"tag-oil","15":"tag-price","16":"tag-tops","17":"tag-trump","18":"tag-warns"},"_links":{"self":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/48937","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=48937"}],"version-history":[{"count":0,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/48937\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/media\/48938"}],"wp:attachment":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=48937"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=48937"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=48937"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}