International oil prices break through $90 a barrel, biggest weekly gain in 43 years

[The Financial News]

On the 6th (local time), international oil prices broke through the $90-per-barrel mark. They have surged nearly 36% in a single week, the steepest weekly rise since 1983, a span of 43 years.
The war against the Islamic Republic of Iran launched by the United States of America (US) and the State of Israel is sending oil prices through the roof. Some are warning that prices could soon break through $150 a barrel.
The day’s spike was triggered by remarks from US President Donald Trump. Trump demanded the Islamic Republic of Iran’s “unconditional surrender.” His comments signaled that negotiations have become more difficult, fueling fears that the war will drag on and further disrupt global oil supply and demand.
Brent Crude Oil, the benchmark for international oil prices, closed at $92.69 per barrel for May delivery, soaring $7.28, or 8.52%, from the previous session.
West Texas Intermediate crude oil (WTI), the benchmark for US oil prices, also jumped. The front-month April contract surged $9.89, or 12.21%, to $90.90 per barrel.
Based on closing prices, Brent Crude Oil and WTI have soared nearly 28% and 36%, respectively, over the week since the US and State of Israel’s attacks on the Islamic Republic of Iran began to be priced in on the 2nd. WTI’s weekly gain is the largest since 1983, while Brent’s is the biggest since April 2020.
Even as the prevailing view in the US is that ammunition shortages will prevent it from prolonging the war against the Islamic Republic of Iran, President Trump poured cold water on hopes for negotiations.
In a post on his social media platform Truth Social, he declared, “There will be no deal with Iran, and the only deal is that Iran surrenders unconditionally.”
US Defense Secretary Pete Hegseth also said the previous day that the attacks on the Islamic Republic of Iran have only just begun. Hegseth suggested that the current “operation” could last as long as eight weeks.
The Islamic Republic of Iran, however, is tightening its grip on the global economy and pressuring the world and the US. It is effectively blockading the Strait of Hormuz, the weakest link in the oil supply chain.
Trump has said he would deploy US naval escorts to guarantee safe passage, but ships transiting the area have come under attack, effectively shutting down the strait. A key chokepoint through which about 20% of the world’s oil and natural gas flows has been blocked.
To make matters worse, Trump’s demand for “unconditional surrender” has raised fears that the Islamic Republic of Iran, seeing no room to back down, could escalate its provocations.
Qatar’s Energy Minister Saad Sherida Al Kaabi warned in an interview with Financial Times (FT) that if tankers are unable to pass through the Strait of Hormuz, oil prices could soar to $150 a barrel within weeks.
Al Kaabi expressed concern that Arab oil shipments could soon come to a halt.
Reports said that, on Trump’s orders, the U.S. International Development Finance Corporation (DFC), in cooperation with the U.S. Department of the Treasury (Treasury Department), would establish a $20 billion Strait of Hormuz transit reinsurance program to support navigation through the strait and work with United States Central Command (CENTCOM) to protect shipping. However, this was not enough to stop the surge in oil prices.

dympna@fnnews.com Song Kyung-jae Reporter