Key Points:
- Brent crude prices settled near $110 a barrel after briefly surpassing $126 earlier in the trading session.
- The ongoing conflict between the United States and Iran keeps the critical Strait of Hormuz closed to energy shipping.
- American crude oil exports reached a record 6 million barrels per day as global buyers replaced lost Middle Eastern supplies.
- Iran’s supreme leader vowed to maintain control of the shipping route and keep the country’s nuclear technology.
Oil prices took a brief break after rocketing to a four-year high. Brent crude futures settled near $110 a barrel on Thursday. Earlier in the day, the June contract pushed past $126 a barrel. This massive spike marked the highest oil price the world has seen since Russia invaded Ukraine in 2022.
Very few human traders bought or sold oil during this quiet trading session. Instead, computer algorithms and robotic trading programs took control of the market. Experts noted that traders closed out their positions right before the June contract expired. Meanwhile, West Texas Intermediate crude traded around $106 a barrel.
The ongoing war between the United States and Iran continues to drive these massive price swings. Peace talks remain completely deadlocked. Because the two nations refuse to negotiate, the Strait of Hormuz stays closed. Iran shut down this vital energy shipping route when the war started in late February. The United States military added even more pressure by putting a naval blockade on all Iranian ports.
Computer trading models heavily influenced the recent price action. Trend-following commodity programs reached their 100% maximum long position for Brent crude on Friday. This means the robots exhausted all their buying power for the session. Data from Kpler shows that algorithmic traders currently hold a 91% long position in West Texas Intermediate futures.
Scott Shelton, an energy specialist at TP ICAP Group, explained the strange market behavior. He noted that market liquidity looks terrible right now. Since human participation remains very low, robotic traders sit completely in the driver’s seat. The market essentially does whatever the computer programs want it to do.
These quiet market conditions slightly muted some very aggressive news from the military. News outlet Axios reported that Admiral Brad Cooper, head of the United States Central Command, plans to brief President Donald Trump. They will discuss resuming active military options inside Iran.
The closed Strait of Hormuz continues to damage the global economy severely. The lack of oil creates fuel shortages, drives up inflation, and slows global growth. The euro-area economy unexpectedly slowed down at the beginning of 2026. Experts warn that soaring energy costs could force Europe into a dangerous period of stagflation over the coming months.
To make up for the missing Middle East oil, global buyers turned their attention to American drillers. United States crude exports surged to an absolute record last week. American energy companies shipped more than 6 million barrels a day overseas. This massive number easily beat the previous record of nearly 5.3 million barrels set in late 2023.
Ryan McKay, a senior commodity strategist at TD Securities, warned that energy markets face a ticking clock. He said the math looks very grim without an open Strait of Hormuz. McKay predicted that global oil inventories will hit multi-year lows soon. He believes oil storage tanks could drop to their absolute minimum operating levels by this summer.
President Trump recently met with top oil executives at the White House. He discussed steps the United States could take to keep the naval blockade active while protecting American consumers from high gas prices. Robert Rennie, head of commodity research at Westpac Banking Corporation, said Trump took away the market’s hope for a quick end to the war. Rennie noted that both sides still believe they will win the war, so neither has reason to negotiate.
Iran shows no signs of giving up the fight. Iranian Supreme Leader Mojtaba Khamenei released a rare public statement on Thursday. He promised his country would never surrender its nuclear programs or missile technologies. He also signaled that Tehran plans to maintain absolute control over the Strait of Hormuz. Iran’s desire to build nuclear weapons remains the core issue driving the war with the United States and Israel.
The United States government also plans to escalate its economic attacks. Washington wants to legally confiscate the oil cargo from two seized ships linked to Iran. Seizing this valuable oil matches the aggressive economic strategy the government used after ousting Venezuelan President Nicolás Maduro.
