Oil prices climbed sharply on Thursday amid rising fears over the prolonged closure of the Strait of Hormuz, as the ongoing U.S.–Iran conflict disrupts crucial Middle East oil and gas flows while production facilities curb output.
By 0141 GMT, Brent crude was trading at $83.07 per barrel, up $1.67, or 2.05 per cent, equivalent to approximately RM378 per barrel. Meanwhile, U.S. West Texas Intermediate crude rose $1.94, or 2.60 per cent, to $76.60, roughly RM348 per barrel.
The escalation followed a U.S. strike on an Iranian warship near Sri Lanka, with U.S. Senate Republicans backing President Donald Trump’s military campaign against Iran, rejecting a bipartisan resolution aimed at halting the air campaign and requiring congressional authorisation for hostilities.
Iraq, the second-largest crude producer in OPEC, has cut production by nearly 1.5 million barrels per day due to limited storage and constrained export routes, officials told Reuters. Qatar, the Gulf’s largest liquefied natural gas producer, declared force majeure on gas exports on Wednesday, with normal production expected to resume only in about a month.
Shipping through the Strait of Hormuz—a critical route accounting for nearly a fifth of global energy consumption—has almost halted for the fifth day since the escalation. Britain’s maritime trade agency reported a large explosion near a tanker anchored 30 nautical miles southeast of Kuwait’s Mubarak Al Kabeer, with a small craft departing the area shortly after.
While Iran has avoided hitting most key energy infrastructure, it has kept shipping risks extremely high, according to a J.P. Morgan note, which estimates some 329 oil vessels are now stranded in the Gulf. The report noted that storage limits in Gulf Cooperation Council (GCC) countries and prevailing energy prices constrain the duration of the U.S. campaign.
Most oil fields could restart within days, with full production typically restored in two to three weeks, J.P. Morgan added. “Operators must gradually rebuild reservoir pressure, particularly in Iraq where water injection is critical. Today, the primary bottleneck is logistics rather than geology,” the report stated.
The surge in oil prices reflects heightened geopolitical tensions, supply disruptions, and uncertainty over how long the Strait of Hormuz will remain effectively closed, with significant implications for global energy markets and oil prices in Malaysian Ringgit.
