Brent Hits $111, as Strait of Hormuz Closure Drains Global Reserves

Brent crude oil reached $111 per barrel on Monday. WTI crude surpassed $107 during the same session. The continued closure of the Strait of Hormuz drove the price rally.

A diplomatic impasse between the U.S. and Iran prevents the reopening of the waterway. This passage handles approximately 20% of global LNG and a significant portion of seaborne oil. Markets fear a prolonged supply crisis.

Global oil reserves have fallen to 7.8 billion barrels. Projections indicate reserves will drop to 7.6 billion barrels by the end of May. European and Asian nations are currently competing for limited spot LNG cargoes.

ExxonMobil's CEO warned that market prices will likely increase if reserves continue to drop.