Brent crude swung from $73 to nearly $120 and back within two weeks. Here is a data-driven breakdown of the supply shock, the policy response, and the key variables to watch.
The Supply Shock in Numbers
The Iran war, which began on February 28 with coordinated U.S.-Israeli strikes, has triggered what Rapidan Energy Group describes as the largest oil supply disruption in history — roughly 20% of global supply, more than double the 1956 Suez Crisis record. The mechanism is the Strait of Hormuz, which Iran declared closed in retaliation. Tanker traffic fell by approximately 95% in the first week of March, according to S&P Global Market Intelligence. The strait normally carries around 20% of global petroleum consumption.
The downstream effect is already cascading. Iraq and Kuwait have begun shutting down production. Saudi Aramco’s Ras Tanura terminal closed following regional attacks. A source at a Gulf state oil company told Reuters: “At some point soon, everyone will also shut in if vessels do not come.” Rystad Energy analyst Amir Zaman cautioned that shut-in fields may take days to months to return to prior output.
| Event | Brent ($/bbl) | WTI ($/bbl) |
| Feb 27 — Pre-war | ~$73 | ~$67 |
| Mar 2 — War day 3 | High $70s | ~$74 |
| Mar 8 — Week 1 peak | ~$120 (intraday) | $110+ |
| Mar 10 — Post-Wright tweet | $87.80 | $83.45 |
| Mar 11 — Latest close | $91.98 | $87.25 |
Sources: CNBC, CNN Business, NPR, Al Jazeera. Mar 10 drop driven by a since-deleted tweet by Energy Secretary Wright claiming Navy had escorted a tanker through the strait — which the White House denied.
The Policy Response — and Its Limits
The IEA’s 32 member countries approved a release of 400 million barrels on March 11 — the largest in the organization’s 52-year history. The U.S. separately announced a 172 million barrel SPR release. IEA Executive Director Fatih Birol called the conflict’s supply implications “significant” for energy security and affordability globally.
OPEC+ also agreed to a larger-than-expected production increase over the same weekend — a move that would normally push prices lower. Helima Croft of RBC Capital Markets described this as potentially “an entirely moot point” because the Hormuz closure makes it impossible to move much of that additional supply to market. The strait closure also hit LNG: Qatar declared force majeure on gas exports following drone attacks, reducing global LNG supply by an estimated 20% according to the IEA.
| ⚠️ Analyst consensus: Strategic reserves buy time if the war resolves in weeks. “If it extends into months, reserves alone will not be sufficient” — Mohit Kumar, Jefferies. Sasha Foss at Marex put it plainly: without resolution by end of this week, prices are expected to spike back above $100. |
Key Price Scenarios from Major Banks
Goldman Sachs warned that Brent could climb above $100 if shipping disruptions continue. JP Morgan noted markets have shifted from pricing a geopolitical premium to grappling with tangible operational disruption as refinery shutdowns and export constraints impair crude flows. Jefferies offers the clearest scenario split: short war (weeks) — reserves stabilize the market; extended war (months) — a structurally higher price equilibrium is required. The IMF framework is useful for macro context: every 10% rise in oil prices adds roughly 0.4% to inflation and subtracts 0.15% from GDP growth. U.S. petroleum prices are up approximately 17% since the war began.
What Traders Need to Watch
Duration is the decisive variable. Every major analyst agrees the disruption is survivable for weeks; months is a different price regime. Track diplomatic signals and strait traffic data from S&P Global closely. Verbal intervention is a live market-moving force — the Energy Secretary’s deleted tweet moved prices 17% intraday before being corrected, illustrating the signal-to-noise problem in real time. Do not trade OPEC announcements at face value while the strait remains closed; transit capacity, not production agreements, is what matters. The IEA and SPR releases act as a near-term ceiling, but that ceiling is time-limited and erodes with each additional week of disruption.
Geopolitical wildcards include: Iran’s newly named hard-line supreme leader (President Trump called the pick “unacceptable”), any credible partial reopening of the strait (analyst David Roche suggested 2–3 weeks is plausible), and regional escalation risks — Saudi Arabia, Qatar, and Bahrain have all reported infrastructure attacks in the past week.
Data as of March 12, 2026.
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