Oil prices strengthened on Monday as markets reacted to heightened geopolitical tension ahead of a critical U.S. deadline to Iran over the Strait of Hormuz. As at the time of writing 06:20 (WAT), WTI crude traded at $113.0 per barrel (+1.30%), Brent at $110.3 (+1.15%), while Murban rose sharply to $117.9 (+2.69%). Natural gas also edged higher to $2.829 (+1.04%), signalling broader tightness across the energy complex.
The price movement reflects growing supply risk as the Strait of Hormuz remains partially restricted, limiting the flow of crude and LNG into global markets. With roughly 20% of global energy supply passing through the corridor, even limited disruption continues to attract a strong risk premium.
Market sentiment has been further shaped by firm rhetoric from Washington, with threats to target Iran’s energy infrastructure if the route is not reopened. While diplomatic signals persist, traders are increasingly positioning for escalation rather than a quick resolution.
Adding to the pressure, Qatar’s LNG exports remain constrained, with reports of tankers making U-turns at Hormuz. This has tightened global gas supply, pushing prices higher and reinforcing substitution demand for crude and refined products.
From a structural standpoint, the market is being driven by three key forces geopolitical risk, logistics disruption, and supply tightness. These factors continue to outweigh traditional demand-supply fundamentals, keeping prices elevated.
Notably, Murban crude’s stronger rally highlights regional scarcity for Middle Eastern grades, while Brent and WTI gains reflect broader global sentiment tied to risk exposure and supply uncertainty.
In the near term, oil prices are expected to remain firm, with any escalation likely to push benchmarks higher. For Nigeria and other import-dependent markets, this trend signals sustained pressure on landing costs and downstream fuel pricing.