Oil Prices Spike Above $106 After Trump Declares Strait of Hormuz Sealed

Tensions between the United States and Iran have escalated over control of the Strait of Hormuz, a chokepoint that moves about one‑fifth of global oil and natural gas shipments. The US has required vessels to obtain Navy permission to transit, while Iran insists it should decide which ships may pass. Recent tit‑for‑tat seizures of commercial tankers have heightened fears of a broader blockade.

Brent crude reached $106.80 per barrel, nearly 5% higher than Wednesday’s close above $100. Trump declared the Strait of Hormuz "sealed up tight" until Iran makes a deal. Only nine commercial vessels passed through the Strait on Wednesday, down from 15 on Monday.

The price jump reflects market anxiety that reduced shipments could tighten global supply, especially if the blockade persists. Lower transit numbers already signal a slowdown in energy flows, which could push refiners to seek alternative routes or face higher input costs. Investors are watching for any diplomatic signal from Iran that might ease the standoff, as well as further US Navy actions that could affect vessel clearance.