Crude oil prices remained elevated on Wednesday, hovering close to the $100 per barrel mark as the ongoing Iran conflict continues to disrupt global supply chains and sustain market uncertainty.
Brent crude oil traded around $98–$99 per barrel, while U.S. West Texas Intermediate (WTI) hovered near $89–$90.
The current price level underscores the persistent impact of supply disruptions linked to the closure of the Strait of Hormuz, a strategic route responsible for transporting roughly 20 percent of global oil supply.
Recent developments show that although a ceasefire has been extended, the blockade on Iranian oil routes remains in place, limiting the movement of crude and keeping supply tight.
Analysts say the oil market has largely priced in temporary diplomatic efforts with traders focusing more on actual supply conditions than political announcements.
As a result, crude prices have stabilised at elevated levels rather than declining sharply.
The scale of the disruption remains historically significant. Estimates indicate that more than 12 million barrels per day of oil supply have been removed from the market since the conflict intensified, representing one of the largest supply shocks in modern energy history.
This supply shortfall has been further compounded by limited spare capacity among major oil producers, reducing the ability of countries like Saudi Arabia and the United Arab Emirates to offset the deficit.
Despite the supply constraints, market volatility persists as oil prices have fluctuated sharply in recent weeks, briefly rising above $100 before retreating amid ceasefire optimism and renewed negotiations.
However, the lack of a confirmed and lasting resolution continues to support prices.
Global oil inventories are also trending lower, with projections pointing to record lows if disruptions persist through the coming weeks.
On the demand side, the outlook remains mixed. Short-term consumption has weakened slightly due to high prices and economic pressure, particularly in Asia, where dependence on Middle Eastern crude remains high.
However, long-term demand expectations remain firm as countries respond to energy security concerns by increasing investment in domestic production and refining capacity.
For policymakers and investors, the sustained strength in oil prices raises concerns about inflationary pressure, especially in import-dependent economies. Rising fuel costs are already feeding into transportation and energy expenses globally.
Market participants are expected to remain cautious in the near term with oil prices likely to stay elevated as long as supply disruptions in the Middle East persist.
The direction of crude oil in the coming weeks will depend largely on developments around the Iran conflict, the status of the Strait of Hormuz, and the ability of global producers to stabilise supply.
