Crude oil and gasoline prices surged today, with June WTI crude up 2.84% and June RBOB gasoline climbing 2.82%. This rally follows the cancellation of US-Iran peace talks, which has led to heightened tensions in the Strait of Hormuz, a critical chokepoint for global oil supplies. Iran’s recent seizure of two ships and aggressive actions against cargo vessels have further escalated concerns about supply disruptions, prompting market reactions.

The Energy Information Administration’s (EIA) latest report revealed mixed results, with gasoline and distillate inventories falling more than expected, while crude inventories unexpectedly rose to a 2.75-year high. Despite this bearish signal, the ongoing geopolitical tensions and a blockade of Iranian ports suggest a tightening supply environment that could keep prices elevated. Additionally, OPEC+ production increases may be stymied by the conflict, as Middle Eastern producers are forced to cut output.

Market professionals should closely monitor the evolving situation in the Strait of Hormuz, as disruptions could exacerbate global oil shortages and influence price trajectories in the coming weeks.

Source: nasdaq.com