NEW YORK, April 6, 2026, 16:03 EDT
Oil finished higher Monday, after a back-and-forth session that saw U.S. West Texas Intermediate close at $112.41 a barrel and Brent at $109.77. Traders juggled signs of a possible ceasefire with the looming threat of new U.S. measures if Iran fails to reach a deal by Tuesday night.
The issue right now comes down to more than supply—it’s access that traders are watching. The Strait of Hormuz, which typically sees around 20% of global oil and gas shipments, is still mostly blocked. Iran has stood firm on keeping the lane closed for now, demanding a ceasefire before reopening, although a few vessels from nations considered friendly by Tehran have made it through since Thursday. “The most important headline this weekend has been that some ships passed through the strait,” said SEB analyst Ole Hvalbye. Reuters
Physical markets are feeling the heat. Spot premiums for U.S. crude have surged to all-time highs, Reuters reported, as Asian and European buyers scramble to secure replacement barrels. WTI Midland cargoes for July heading to North Asia have been offered at a hefty $30 to $40 a barrel above benchmark. That squeeze only intensified with WTI’s prompt spread flipping into even steeper backwardation—immediate delivery barrels commanding sharply higher prices as buyers hunt for near-term supply. “Asian refiners, shut out of Middle Eastern supply, are bidding aggressively for every available Atlantic Basin barrel,” wrote Rystad Energy’s Paola Rodriguez-Masiu. Reuters
OPEC+ agreed Sunday to bump up May quotas by 206,000 barrels per day, aiming to signal some flexibility. Still, the group made clear the decision could be paused or even reversed if needed. Analysts weren’t convinced it would matter much, given the ongoing squeeze at Hormuz and with 12 million to 15 million barrels per day still sidelined or delayed. “In reality it adds very few barrels to the market,” said Jorge Leon, head of geopolitical analysis at Rystad Energy. Reuters
The shakeup is shifting producer rankings. According to a Reuters analysis, Saudi Arabia—able to sidestep Hormuz thanks to other export routes—has benefited from the price spike. Iraq and Kuwait haven’t been so lucky; both, with most shipments still moving through the strait, have suffered the steepest drops in revenue.
Iraq is pushing to restart exports. State oil marketer SOMO told customers to send lifting schedules within 24 hours, following reports that Tehran would allow Iraqi cargoes through without transit restrictions. Basra’s loading terminals are prepared to handle full programs, SOMO said, though there’s still doubt among market players about whether shipowners are willing to send tankers into the Gulf.
But crude now faces a more defined risk to the downside, though that still hinges on several conditions. “We have not received any formal documents regarding permission for Iraqi tankers to pass,” Basra Oil Company chief Bassem Abdul Karim told Reuters. If the war wraps up and safe transit through Hormuz is assured, Abdul Karim said exports might bounce back to roughly 3.4 million barrels a day within a week. Reuters
Ripple effects aren’t stopping at oil. IMF Managing Director Kristalina Georgieva put it bluntly: “all roads now lead to higher prices and slower growth.” Over in Japan, the central bank flagged that companies are already cautioning about squeezed profits, weaker spending, and tighter supplies if the conflict stretches out. Reuters
