Oil prices could surge past $150 a barrel for the first time in history if restrictions on tanker movement through the Strait of Hormuz persist, according to market analysts, even as Brent crude has recently fallen sharply on hopes of de-escalation between the United States and Iran. Brent, the global benchmark, is down around 12 percent in a week to about $97 a barrel, marking its steepest weekly decline in ten months. The drop has been driven by a conditional ceasefire agreement and cautious optimism that negotiations could eventually stabilise the Gulf region.
Despite this decline, commodity analysts warn that the underlying physical supply situation remains fragile. Data firm Kpler says markets are underestimating the severity of ongoing shipping disruptions, with only a limited number of crude carriers currently transiting the Strait each day. The waterway, through which roughly a fifth of global oil and liquefied natural gas normally passes, remains effectively constrained, leaving vessels stranded and disrupting normal trade flows. Analysts argue that this bottleneck is masking deeper risks in pricing, as futures markets continue to reflect optimism rather than physical supply stress.
Naveen Das, senior crude analyst at Kpler, warned that if current conditions persist into late April, oil prices could quickly return to record territory. He said that continued disruption would likely push Brent towards all-time highs, surpassing the previous peak of $147.50 reached in 2008, with even higher levels possible if the ceasefire collapses entirely. In a more severe escalation scenario, some analysts suggest prices could reach $170 a barrel as markets begin to price in prolonged conflict and the rapid depletion of spare global supply capacity.
Other market experts share concerns about the fragility of the situation. Ole Hansen, head of commodity strategy at Saxo Bank, said that while diplomatic signals suggest de-escalation, the Strait remains functionally constrained due to security concerns and insurance limitations. He noted that the disruption has left many cargoes unable to move normally, tightening effective supply even as headline prices fall. Hansen added that although he does not expect the ceasefire to break down immediately, any renewed conflict could still push prices back towards $140 in a matter of weeks.
Energy consultancy Wood Mackenzie also warned that sentiment could shift rapidly if tensions escalate further, pointing to reports of additional attacks and damage to regional infrastructure that highlight how unstable the situation remains. While near-term prices have eased, analysts emphasise that benchmark crude is still significantly higher than pre-conflict levels, reflecting a persistent geopolitical risk premium embedded in global energy markets.
