Oil gains 12% this week as Hormuz blockade drags (2026)

Oil posts a second weekly rise

Oil recorded a second weekly gain after US President Donald Trump said he was sticking with a naval blockade of Iranian ports. The stance kept markets focused on the risk that the Strait of Hormuz will not reopen soon for commercial shipping. Brent for July rose above $111 a barrel, while West Texas Intermediate was near $106. Both benchmarks were up about 12% for the week. The price action followed sharp swings tied to Gulf headlines and shifting expectations around supply.

Trump reiterates blockade and pressure strategy

Trump said the US would continue the naval blockade as a form of economic pressure on Iran. He described the blockade as “incredible” and said Iran’s economy was “crashing,” according to comments to reporters at the White House. In a phone interview with Axios, he said he rejected an Iranian peace offer that would lift the naval blockade and open the strait but delay nuclear talks. Trump told Axios he was going to keep Iran under blockade until the regime agrees to a proposal addressing nuclear capabilities. He also told Axios he viewed the blockade as “somewhat more effective than the bombing” and a primary source of leverage.

Iran signals no quick compromise

Iran’s supreme leader, Mojtaba Khamenei, cast doubt on the likelihood of a deal with the US in a written statement. He vowed not to give up the Islamic Republic’s nuclear or missile technologies and signaled Tehran would keep control of the strait. Iranian President Masoud Pezeshkian said in a social media post that he considered the US naval blockade an “extension of military operations,” calling it “intolerable.” Iran has also said it will not reopen the strait to commercial vessels until the US lifts its blockade. Together, the statements hardened the market’s view that any reopening could take time.

Why Hormuz matters to crude and LNG flows

The Strait of Hormuz is a critical chokepoint, and before the war it carried about a fifth of the world’s crude. Separate reports described it as a conduit for about 20% of global oil and LNG supplies. With the waterway effectively choked, the market has had to adjust to the sudden loss of seaborne flows from the Persian Gulf. Bloomberg reporting described a near-total closure extending as negotiations remain deadlocked. The longer the disruption lasts, the more sensitive prices become to incremental changes in enforcement or diplomatic signals.

Supply disruption: “more than 10,000,000 barrels a day” missing

Bloomberg reporting cited a shortfall of more than 10,000,000 barrels a day of oil that would have been going to the market out of the Persian Gulf through Hormuz. With those barrels not reaching buyers, the market response has included pulling oil out of storage and demand destruction. The same reporting said prices jumped to the highest level of the war as the market adjusted to reduced flows. It also noted that some tankers had “sneak[ed] through” during an initial opening, but that there is still not free flow. The lack of visibility on when the strait could reopen has kept headline risk elevated.

Prices hit war highs before easing

Brent futures initially rose to $126 a barrel, described as the highest level since the conflict began, before ending that session near $114. Early Friday, Brent for July delivery was trading at about $112 a barrel. Elsewhere in the reporting set, Brent crude also traded around $112, while the more active July contract was cited at $105.32 at one point. This mix of intraday spikes and pullbacks has reinforced the market’s sensitivity to news from Washington and Tehran. It has also contributed to a more cautious approach to selloffs as traders react to sudden reversals.

Volatility, curve signals, and inventories

The uncertainty over future supply has produced sharp price swings and a flattening of the futures curve, according to the article. Market sources also said the American Petroleum Institute reported US crude oil inventories fell for a second week. At the same time, analysts said any near-term market impact from some developments may be limited without a broader resolution. ING analysts wrote that there must be a resolution in the Persian Gulf allowing for uninhibited energy flows through Hormuz before an increase in UAE output can be realised. These points underline how quickly financial pricing can change, even if physical constraints remain.

What analysts are saying

Carl Larry, an oil and gas analyst at Enverus, said: “Selloffs are approached cautiously, but the bandwagon fills up on moves higher.” He added: “Every day continues to be an adventure, but also a chance to make money...quickly.” Yang An, an analyst at Haitong Futures, said the recent rise in oil prices has been driven by the Strait blockade and that an extended blockade would worsen supply disruptions and continue to push prices higher. The remarks reflect a market where both headline risk and physical supply constraints are shaping daily price moves.

Spillover to consumers and inflation concerns

Rising crude prices have also fed into retail fuel concerns. Reporting said oil prices across parts of the US were rising sharply, with the national average at fresh highs and retail gasoline in California soaring above $1 a gallon. In India-focused coverage, Brent crossing $120 was framed as raising fears of higher fuel costs and inflation. While those articles focused on different audiences, the central driver was the same: continued disruption risk around Hormuz and uncertainty about when commercial flows normalise.

Key facts at a glance

What to watch next

The next key trigger remains whether Washington and Tehran shift positions on the blockade and the conditions for reopening the strait. Iran has linked reopening to the US lifting its blockade, while Trump has publicly backed keeping restrictions in place. With limited visibility on when freer movement can resume, prices are likely to remain sensitive to official statements and any verified changes in tanker traffic. Traders will also track whether inventory draws continue and whether the futures curve stays unusually flat.