Oil could top $100 as insurers pull cover and Hormuz traffic stalls

Oil could hit $100 a barrel if tanker traffic through the Strait of Hormuz is not restored after US and Israel's strikes on Iran. US West Texas Intermediate futures spiked as much as 12% at the open and Brent jumped 13%, with WTI later trading 4.8% higher at $70.26 a barrel and Brent 5.1% higher at $76.58 at 8:33 p.m.

ET. The Strait of Hormuz, where about 15 million barrels of crude pass daily, has become a flashpoint after Tehran warned ships not to pass and several vessels came under fire. Insurers have pulled coverage and vessels are increasingly reluctant to navigate the passage; Alan Gelder said the key question is when vessels will re-establish export flows and warned that tanker rates and insurance would rise sharply, though those costs would be only a small part of the price impact if flows are curtailed for more than a few days.

Kpler's Amena Bakr noted that commercial operators, major oil companies, and insurers have effectively withdrawn from the corridor and that insurance premiums had already reached six-year highs.

Iran, Strait of Hormuz

oil price, brent, wti, hormuz strait, tanker traffic, insurers, insurance premiums, tanker rates, iran, israel