Oil prices fell on Monday as attacks on Gulf oil infrastructure and calls from US President Donald Trump for international efforts to secure the Strait of Hormuz weighed on the market. Brent crude futures dropped 92 cents to $102.22 a barrel, while US West Texas Intermediate crude fell $3.45, or 3.5%, to $95.26. Both benchmarks had surged more than 40% over the past month following US-Israeli strikes on Iran, which prompted Tehran to halt shipping through the vital waterway.
The Strait of Hormuz, a narrow channel linking the Persian Gulf to the Arabian Sea, handles about a fifth of global oil and liquefied natural gas shipments. The disruption has forced the United Arab Emirates to cut daily output by more than half. State oil company ADNOC suspended crude loading at the port of Fujairah after a drone attack ignited fires at the key export terminal. While some operations have resumed, only two of the port’s three single point moorings are currently operational. Fujairah exports roughly 1 million barrels per day of Murban crude, accounting for about 1% of global oil demand.
President Trump is engaging European allies and other nations on coordinated action to reopen the Strait of Hormuz, according to White House Press Secretary Karoline Leavitt. The UK government also said it is exploring a “viable” plan with allies to restore the passage. US Treasury Secretary Scott Bessent told CNBC that the Treasury has not yet intervened in oil markets, noting that any actions to ease prices would depend on the conflict’s duration.
The International Energy Agency (IEA) described the ongoing Gulf conflict as the largest disruption to global oil supply in history. Major producers, including Saudi Arabia, Iraq, and the UAE, have implemented production cuts, adding pressure to already tight markets. Analyst Tamas Varga of PVM said investors are concerned about the long-term effects of the conflict, as inventories decline and infrastructure damage continues after just two weeks of disruption.
Over the weekend, Trump warned of further strikes on Iran’s Kharg Island, which handles about 90% of the country’s oil exports, after targeting military facilities. He said the US is in contact with Tehran but questioned whether serious negotiations are underway to end the conflict.
The IEA announced plans to release over 400 million barrels from strategic reserves to help offset rising prices. Supplies from Asia and Oceania will be made available immediately, with European and American stocks released by the end of March.
Market observers said the third week of hostilities has left investors wary of an escalating conflict. Chris Wright, US Energy Secretary, expressed optimism that the war could end within weeks, predicting that oil supplies would recover and energy costs would ease once stability returns.
The combination of Gulf attacks, production cuts, and geopolitical uncertainty continues to shape global energy markets, underscoring the vulnerability of key supply routes and the high stakes for international oil security.
