🛢️ Global Oil Crisis: Strait of Hormuz Closes, Brent Hits $95 Amid US-Iran Escalation

The U.S.-Iran conflict has intensified sharply, triggering a major surge in global energy markets after Iran announced the immediate closure of the Strait of Hormuz to all vessels. • Market Impact & Oil Prices: Brent crude futures breached $95 per barrel during Thursday’s session, while WTI futures climbed over 2% intraday to cross $92. • Strait of Hormuz Blockade: Iranian officials stated any ship attempting to transit the vital maritime chokepoint will be attacked. The escalation follows a U.S. military strike on June 9 and subsequent Iranian retaliation on U.S. bases. • Inventory Collapse: The U.S. EIA forecasts that if traffic does not normalize before early 2027, OECD oil inventories will plunge below 2.3 Bn barrels by December 2026—the lowest since records began in 2003, covering just 50 days of global demand. • JPMorgan Price Outlook: Global inventories are expected to enter a "stress zone" by late June. JPMorgan forecasts Brent to average $100 per barrel if the strait reopens this month. However, every additional month of blockade in Q3 will add ~$5 to the average price, skyrocketing to an additional ~$15 per month if the blockade extends into Q4. _Context for Sri Lanka_: As an oil-importing nation, a prolonged blockade and sustained prices above $100/bbl pose significant risks to Sri Lanka's import bill, foreign reserves, and domestic inflation.