Oil prices, stocks surge as Hormuz closure drags on

What the report says

Oil markets and energy stocks moved higher on Monday as investors grew less optimistic that the Strait of Hormuz would reopen soon, according to Al Jazeera citing Reuters. Brent crude futures rose more than $2, with the benchmark up 3.3% at $84.64 a barrel, while US West Texas Intermediate gained 3.1% to $80.63. The report said the trading move followed a period of easing last week, when both benchmarks had fallen about 7% amid hopes of a deal to restore access to the waterway.

Al Jazeera said Tehran has tied any reopening to US concessions, including an end to military threats and sanctions, plus compensation. The Strait of Hormuz is a key shipping route for global oil supplies, so any prolonged disruption can quickly affect crude prices and fuel costs.

The article also noted that American motorists briefly saw relief, with AAA data showing US petrol prices fell nine cents last week to an average of $4.00 a gallon. However, analysts warned that continued closure could push prices back up. GasBuddy’s Patrick De Haan said national fuel prices could rise quickly if the situation does not improve.

Shares of major oil producers also advanced in US trading, including ExxonMobil, Chevron, BP, Shell and ConocoPhillips. In general, higher crude prices tend to support energy company earnings while increasing costs for consumers and businesses.