Crude oil jumps as the U.S.-Iran deadlock brings Hormuz risk back into market focus

📌 Crude oil rose more than 3% in the Asian session, with Brent around $107.55 per barrel and WTI around $101.25 per barrel. Both benchmarks moving above the $100 area shows that the market is repricing supply-risk premium, rather than only reacting to short-term news flow.
⚠️ The main driver comes from the near-deadlock in the U.S.-Iran ceasefire process, after both sides continued rejecting each other’s proposals. The description that the ceasefire is “on life support” has clearly weakened expectations of geopolitical de-escalation, while concerns around the Strait of Hormuz have returned to the center of attention.
🔎 The key issue is not only political risk, but the possibility of real supply disruption. Hormuz remains a critical route for global oil and LNG flows, so any signal of a prolonged blockade could force the market to maintain a higher-than-usual premium.
💡 The current supply backdrop is also unfavorable, as OPEC output in April fell to its lowest level in more than 20 years due to disruption around Hormuz. Saudi Aramco’s warning that the market may only stabilize again in 2027 further supports the view that this shock may not be resolved within just a few sessions.
⏱️ Over the next 24–72 hours, oil prices may continue to hold at elevated levels if there is no clear diplomatic breakthrough or partial reopening of Hormuz. Conversely, if a credible diplomatic step emerges, oil could cool quickly because the geopolitical premium has already been pushed up sharply.
✅ The next key markers to watch are U.S. API/EIA inventory data and statements after high-level contacts involving the U.S., China, and Iran. At the current level, the oil market is more sensitive to geopolitical headlines, while short-term supply-demand data will either confirm or ease the upward momentum.
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