Oil Hits $96 Brent as Hormuz Blockade Cuts 10 Million Barrels Daily
Oil rose with Brent above $96 and WTI near $92 as the Strait of Hormuz remains blockaded and Washington and Tehran weigh a two-week ceasefire extension. The blockade has removed over 10 million barrels per day of supply and threatens roughly 3.8 million barrels of monthly shipments.
1. Oil Price Movements
Brent crude climbed past $96 per barrel while WTI hovered around $92 as markets reacted to ongoing disruptions in the Persian Gulf. Traders priced in reduced supply, driving near-month Brent into steep contango and lifting revenue forecasts for US oil producers.
2. Strait of Hormuz Blockade Status
The US maintains a naval blockade while Iran prevents most exports, halting flows through a waterway that carried roughly 3.8 million barrels per day last month. Negotiations in Washington and Tehran are assessing a two-week ceasefire extension, but any lapse could instantly reinstate full-scale blockades.
3. Supply Shock Implications for FANG
The blockade has eliminated over 10 million barrels per day of global supply, tightening domestic market balances where Diamondback Energy operates. Sustained WTI near $92 could boost FANG’s realized price by several dollars per barrel, significantly enhancing free cash flow for operations and capital returns.