How high could oil prices go?

Global oil markets are entering a critical phase of volatility as a deadline set by US President Donald Trump for Iran looms, intensifying fears of a major supply shock that could send crude prices sharply higher and destabilise the global economy.

- Issac John

In a worst-case scenario, analysts warn oil prices could surge to between $150 and $200 per barrel if the Strait of Hormuz is fully blocked

Brent crude futures were up 17 cents, or 0.2 per cent at $109.94 a barrel by 1429 GMT while U.S. West Texas Intermediate crude was close to a four-week high at $115.3 a barrel, up $2.89 or 2.6 per cent.

The spike reflects mounting concern over disruptions in the Strait of Hormuz — a narrow but vital artery through which roughly a fifth of the world’s oil and gas supply typically flows.

The latest escalation comes as Washington imposed a deadline for Tehran to agree to terms or face potential military action. Trump warned that the US could “take out” key Iranian infrastructure within hours if negotiations fail, while signalling that talks remain ongoing but uncertain.

Iran, however, has rejected proposals for a temporary ceasefire, insisting on a permanent end to hostilities and the lifting of sanctions. The standoff has already resulted in a sharp decline in tanker traffic through the Strait of Hormuz, with shipping volumes estimated to be as much as 95 per cent below pre-conflict levels.