Impact of the Middle East Conflict, Global Oil Prices Remain at One-Year High
New York, KOMPAS.com - Global oil prices were little changed at the close of trading on Wednesday, 4 March 2026 local time, or Thursday, 5 March 2026, in UK time, staying at the highest level in a year amid the intensifying conflict in the Middle East.
Citing Reuters, Brent crude futures settled at $81.40 per barrel, the same as Tuesday’s close and the highest since January 2025.
Meanwhile, U.S. West Texas Intermediate (WTI) crude rose 10 cents, or 0.1%, to $74.66 per barrel, also the highest since June 2025 for a second consecutive day.
“Oil prices remain elevated as markets grapple with prospects of a protracted war and persistent supply disruptions,” said Tzabouras.
He added that an estimated four to five-week U.S. military strike, Iran’s attempts to widen the conflict in the region, and the closure of the Strait of Hormuz could alter the dynamics of global oil supply and demand.
“These developments could reverse previously unfavourable supply-demand dynamics, pushing crude prices higher and bringing them to the brink of $100,” he said.
Oil prices were volatile in yesterday’s trading.
Early in the morning session, Brent briefly jumped more than $3 to touch $84.48 per barrel. However, prices later retraced after The New York Times reported that officials at Iran’s Ministry of Intelligence signalled to the CIA about potential talks to end the war.
Separately, U.S. Defence Secretary Pete Hegseth stated that his country is in a strong position in the conflict with Iran and that the U.S. military is ready to fight for as long as required.
Meanwhile, Israeli and U.S. strikes on various targets in Iran have provoked Iran’s retaliation against energy infrastructure in the region, which accounts for almost a third of global oil production.
The spectre of global supply disruption has also been heightened by Iraq’s decision, the world’s second-largest oil producer in OPEC, to cut output by almost 1.5 million barrels per day due to storage capacity constraints and bottlenecks in export routes.
Local officials even warned that production could be cut by nearly 3 million barrels per day in the coming days if exports do not normalise.
Shipping through the Strait of Hormuz remains effectively shut.
White House spokesperson Karoline Leavitt said on Wednesday that the U.S. is drawing up plans to secure the Strait of Hormuz to ensure the safety of oil tankers amid the war against Iran.
She added that President Donald Trump and his advisers have discussed what role the U.S. could take in Iran after the military campaign ends.
In the midst of the tensions, several countries and companies are exploring alternative routes and other crude supply sources.
India and Indonesia said they were seeking supplies from different sources, while some Chinese refineries have halted operations or advanced maintenance scheduling. Nevertheless, Senior Vice President Trading Dennis Kissler of BOK Financial assessed that oil availability remains ample, including from floating storage on tankers.
“Global supply remains abundant with tanker-storage levels nearing record highs. However, until the oil finds safe destinations, price volatility is expected to continue,” Kissler stated.