-- Crude futures climbed back above $100 per barrel on Thursday, marking a two-week high, as diplomatic efforts between the US and Iran collapsed.
The Brent futures contract gained 1.3% to $103.25 per barrel. Murban closed at $103.12 on April 22 and was not trading as of the time of publishing this oil price update.
"Brent crude futures settled above $101 a barrel [on Wednesday], gaining 3.5% to $101.91, the highest in two weeks, amid conflicting reports about plans to reschedule peace talks between the US and Iran which have ultimately failed to materialize," Saxo Bank analysts said.
Experts say that the market is now aggressively repricing for a prolonged supply crisis following the seizure of two tankers in the Strait of Hormuz by Iran and a Pentagon estimate suggesting it could take six months to clear mines from the waterway.
The situation escalated further after US forces intercepted at least three Iranian-flagged vessels in Asian waters, before redirecting them from their respective positions, according to a Reuters report on Wednesday.
Iranian Parliament Speaker Mohammad Bagher Ghalibaf reinforced the sense of deadlock, stating on X that reopening the Strait is "impossible" while the US maintains its naval blockade, which he labeled a "hostage-taking of the world's economy."
As Brent convincingly breaks back above the $100 threshold, analysts from ING and Saxo Bank warn that the market is becoming "numb" to diplomatic noise and is instead bracing for long-term physical disruptions.
However, this price spike is triggering demand destruction particularly in Europe.
Rystad analysts report that European refiners are currently battling collapsing margins and a tightening crude supply, a combination that likely forces a reduction in fuel production as the Persian Gulf remains effectively throttled.
With no resolution in sight, the industry expects further upside for prices even as high costs begin to erode global consumption.