Oil Prices Soar as Trump Sets Deadline for Iran
Oil prices surged on Tuesday ahead of a deadline set by US President Donald Trump for Iran to reopen the Strait of Hormuz or face attacks on its power plants and infrastructure. The strait, through which around one-fifth of global oil supply is shipped, has been effectively shut since February 28 following US and Israeli attacks.
The threat from Trump came with a warning that every bridge in Iran would be decimated and every power plant would be out of business by midnight on Wednesday if Tehran fails to comply. Iranian forces have intensified strikes on the country's infrastructure, including railway and road bridges, an airport, petrochemical plants, and power lines.
The conflict has sent oil prices soaring, with Brent crude futures up 1.27% at $111.16 a barrel and US West Texas Intermediate (WTI) crude close to a four-week high at $116 a barrel.
Ole Hansen, an analyst from Saxo bank, attributed the unusual WTI premium over Brent to the market's aggressive pricing of immediacy. The benchmark WTI contract is for May delivery while Brent is for June.