Oil Could Surge to $140 if Iran Closes Strait of Hormuz
Analysts warn that closure of the Strait of Hormuz by Iran could remove 20 million barrels per day of crude and push Brent to $140 per barrel in a worst-case scenario. Disruption of 1.5 million barrels daily from Kharg Island would intensify supply volatility.
1. Geopolitical Tensions Drive Oil Forecasts
Analysts have raised the possibility that escalation between Iran and the U.S. could drive oil prices to $140 per barrel, reflecting a worst-case scenario if Tehran enforces a closure of the Strait of Hormuz.
2. Strait of Hormuz Disruption Risks
The Strait of Hormuz channels some 20 million barrels of crude and over 100 billion cubic meters of LNG annually. Iran’s control over this passage and potential strikes on Kharg Island, which exports 1.5 million barrels per day, would severely strain global energy supplies.
3. Implications for SCO Short Position
A spike toward $140 crude would inflict substantial losses on inverse oil ETFs such as SCO, undermining bearish strategies. Heightened volatility in Brent and gas benchmarks could drive traders to reassess risk in energy derivatives.