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Oil spiked fears after Hormuz closure did not materialize
Brent crude futures peaked around $126 a barrel and averaged roughly $101 from the start of the conflict through June 11, with WTI swinging about $68 to nearly $113 since Feb. 28.
Yahoo Finance reports that despite the Feb. 28 strikes between the United States and Israel and Tehran's subsequent closure of the Strait of Hormuz, the extreme oil-price scenario many traders forecast never appeared. Analysts discussed outcomes like $150 to $200 crude, but actual trading outcomes fell well short.
According to Reuters and AAA, the market dynamics diverged from the expectation of a prolonged vertical price move. Brent futures peaked around $126 a barrel and averaged about $101 between the start of the war and June 11, before briefly retreating to around $70 in early July.
AAA data cited by Yahoo Finance shows that roughly a fifth of the world's oil and refined products move through the Strait of Hormuz, and that ship traffic fell far below prewar levels. Even so, WTI, the U.S. benchmark, has ranged from about $68 to nearly $113 since the fighting began, with WTI near $85 on July 21.
The article also links the oil moves to gasoline prices, noting AAA's figures for the national average regular gas price at $2.98 a gallon on Feb. 28 and a return above $4 for the first time since June 17 by July 20. It also states that WTI traded near $85 on July 21, about $18 higher than a year earlier, while discussing why the feared spike did not arrive.
Latest closeWTI crude $87.52 ▲3.1%|Brent $94.43 ▲3.8%|Gasoline (RBOB) $3.293 ▼3.3%