📈 Global Oil Surges 3% Amid Strait of Hormuz Tensions

Global oil prices jumped over 3% on Monday following reports of military escalation between Iran and the U.S. in the strategic Strait of Hormuz, a critical chokepoint for global energy supplies. • Price Movements: Brent Crude futures rose by US$ 3.64 (+3.4%) to US$ 111.81 per barrel. U.S. WTI crude climbed US$ 3.40 (+3.3%) to US$ 105.34 per barrel. • Conflict Context: Prices spiked after Iran claimed to have struck a U.S. warship; however, U.S. Central Command has officially denied these reports. Tensions remain high as Iran warned of a "harsh response" to any U.S. presence in the waterway. • Supply & Logistics: • Shipping remains constrained near Fujairah, with reports of a tanker hit by unknown projectiles. • OPEC+ announced an output target increase of 188,000 bpd for June, though analysts suggest these gains may only exist "on paper" due to ongoing regional blockades. • Impact on Sri Lanka: As a net importer of fuel and energy, sustained prices above US$ 100/barrel place significant pressure on Sri Lanka's foreign exchange reserves and domestic inflation. Increased shipping risks in the Gulf may also affect the logistics and freight costs for vital imports and exports. _Data based on reports from Reuters and Fars as of May 4, 2026._