Strait of Hormuz Crisis Sends Brent Crude Past $100 as IEA Triggers Record Stockpile Release
Oil prices have surged past $100 per barrel as the ongoing Middle East conflict chokes off flows through the Strait of Hormuz, prompting the IEA to authorize its largest-ever emergency crude release of 172 million barrels.
Brent crude settled above $102 per barrel on Monday as the war between the U.S.-Israel coalition and Iran entered its third week, with flows through the Strait of Hormuz, the world's most critical oil chokepoint, reduced to a trickle from the pre-conflict level of roughly 20 million barrels per day.
The disruption represents the most severe supply shock in the history of the global oil market, surpassing even the 1973 Arab oil embargo in scale. Before the conflict began on February 28, Brent was trading near $70 per barrel, meaning prices have climbed roughly 45% in under three weeks.
Global Supply Plunges 8 Million Barrels Per Day
According to the International Energy Agency's March 2026 Oil Market Report, global oil supply is projected to fall by 8 mb/d this month, with curtailments across the Middle East only partially offset by increased output from non-OPEC+ producers. Saudi Arabia has slashed production by approximately 20% as the conflict continues to block export routes through the Persian Gulf.
The ripple effects are being felt worldwide. TotalEnergies confirmed that the conflict has forced shutdowns of offshore production in Qatar, Iraq, and the UAE, affecting roughly 15% of its global output. China's state-controlled Sinopec has announced plans to cut refinery processing rates by 11–13% as crude supply dwindles.
Record Emergency Stockpile Release
In an effort to stabilize markets, the IEA last week authorized the release of crude oil from national strategic reserves across member nations, including 172 million barrels from the United States' Strategic Petroleum Reserve, the largest coordinated release in the agency's history. The U.S. Energy Department confirmed the release will be structured as an exchange, with companies borrowing crude and returning it later with additional barrels.
Japan has also begun releasing oil from its national reserve to help stabilize supply in Asia.
Fuel Prices Surge Worldwide
Consumers across the globe are feeling the impact at the pump. In the United States, the American Automobile Association reports gasoline averaging $3.72 per gallon nationally, up 27% from a month ago, with diesel approaching $5.00 per gallon. In Canada, pump prices have climbed roughly 22% to an average of C$1.89 per litre. Across the United Kingdom, petrol has risen approximately 18% to around 168p per litre, while European motorists are seeing similar increases, with German fuel prices up roughly 20% to over EUR 1.95 per litre. In Asia, fuel subsidy programs in India and Indonesia are under pressure, with unsubsidized prices in Mumbai up an estimated 15% over the same period.
Outlook Remains Uncertain
The U.S. Energy Information Administration forecasts that Brent will remain above $95 per barrel over the next two months before easing below $80 in the third quarter, assuming a gradual de-escalation of hostilities. However, analysts warn that any expansion of the conflict could push prices back toward the $120 level briefly touched in early March.
Higher prices are expected to drive increased U.S. production, with the EIA forecasting output to average 13.6 million barrels per day in 2026, rising to 13.8 million b/d in 2027 as producers respond to the price signal.
Sources: IEA Oil Market Report March 2026, U.S. EIA Short-Term Energy Outlook, Fortune, NPR, AAA
By Oil Authority · Oil Authority