Global energy markets were jolted on Thursday as oil prices surged to their highest levels in four years. Brent crude, the international benchmark, briefly jumped to $126 a barrel.
This price spike comes as critical negotiations between the United States and Iran remain deadlocked threatening a fragile ceasefire in the two-month-old conflict.
Traders are increasingly worried that the Strait of Hormuz, a vital waterway for a fifth of the world’s oil, will remain blocked.
While a truce has been in place since April, Iran recently reimposed shipping restrictions after the U.S. refused to lift its naval blockade.
In a defiant statement, Ayatollah Mojtaba Khamenei vowed to protect the nation’s assets, stating that the only place Americans belong in the Persian Gulf is “at the bottom of its waters.”
Meanwhile, U.S President Donald Trump has maintained a firm stance urging Tehran to “just give up” as the blockade squeezes the Iranian economy.
Market analysts warn that without a diplomatic breakthrough, prices could climb further.
IG analyst Tony Sycamore noted that “prospect for any near-term resolution to the Iran conflict or a reopening of the Strait of Hormuz remain dim” leaving the global economy in a state of high alert.
