Geopolitical Tensions Push Oil Prices to Three-Month Peak

Crude oil markets surged on Monday amid renewed concerns over Middle East supply routes, with oil prices reaching their strongest levels since late January. The rally was triggered by reports from Iranian state media, as confirmed by RTHK, indicating temporary military exercises in the Hormuz Strait—a critical chokepoint for global oil transportation. March crude oil futures settled at $65.19 per barrel, marking a robust gain of $2.86 or 4.59%, while April Brent crude climbed to $70.35 per barrel, up $2.93 or 4.35%.

Hormuz Strait Drills Stoke Supply Uncertainty

The announcement of military exercises in the Hormuz Strait immediately heightened market anxiety about potential disruptions to oil shipments. As one of the world’s most strategically important waterways, any temporary closure or operational disruption sends ripples through global energy markets. Traders quickly priced in a risk premium, anticipating tighter crude supplies and potential logistical bottlenecks for major oil exporters in the region.

Oil Prices Reflect Compounding Risk Factors

Beyond the immediate Strait concerns, oil prices remained pressured by the stalled Ukraine-Russia negotiations underway in Geneva. With peace talks showing minimal progress, geopolitical uncertainties continue to weigh on energy markets. The combination of Middle East supply risks and Eastern European tensions creates a complex backdrop for oil traders, supporting the recent strength in crude valuations across both WTI and Brent benchmarks.