DTN Oil Update
Oil Up 9% as US Reimposes Iran Maritime Blockade
SECAUCUS, N.J. (DTN) -- Crude oil futures jumped more than 9% Monday, the highest daily rise since the Middle East conflict peaked four months ago, as the U.S. announced it will reimpose a full blockade on Iranian maritime trade.
A naval blockade of all Iranian ports and coastal areas will start at 20:00 GMT on July 14 and will cover vessels of all flags and every Iranian oil terminal, the U.S. Navy-led Joint Maritime Information Center said.
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While the embargo will not impact ships or assets outside of Iranian trade, vessel traffic on the Strait of Hormuz contested by both Washington and Tehran had already hit a five-week low as of Sunday, July 12, after intense exchange of fire between U.S and Iranian forces. Prior to the war, the strait saw passage of about 20 million bpd of petroleum liquids.
In Monday's session, ICE Brent crude for September finished up $7.29 at $83.30 bbl. It was the global crude benchmark's biggest daily percentage advance since the conflict began on Feb. 28.
NYMEX WTI for August delivery settled up $6.73 at $78.14 bbl. The U.S. crude benchmark rose 9.4% on the day, the most since a 9.7% rally on March 12.
Refined products followed crude sharply higher across the complex. NYMEX ULSD for August delivery surged $0.2703 to close at $3.8236 gallon, while August RBOB gasoline climbed $0.1817 to end at $3.1663 gallon.
Adding to the geopolitical volatility, U.S. President Donald Trump proposed a mandatory 20% toll on all commercial cargo transiting the Strait of Hormuz. Trump argued the levy would offset American military expenditures for securing the passage, drawing swift criticism from international maritime organizations and foreign allies.
Iran, which regards the Hormuz as part of its territorial waters and has its own plans to impose a levy on the strait, vowed to target any vessel complying with the U.S. plan.
The escalation overshadowed a downcast monthly report from OPEC, which downgraded its 2026 global oil demand growth forecast for a third consecutive month by 190,000 bpd to 780,000 bpd. The producer group blamed ongoing regional hostilities for straining global supply chains and reducing consumption across major Asian markets. Conversely, the 12-member group upgraded its 2027 global oil demand growth projection by 210,000 bpd to 1.73 million bpd.
Crude futures hit 4-1/2-year highs at the peak of the conflict, driving WTI above $119.48 bbl in March and Brent to over $126.41 bbl in April. They fell after a ceasefire agreement in mid-June sent the U.S. benchmark to around $67 and its global peer to about $70. Fresh hostilities over the past week have led to a new round of rallies.