Qatar energy minister sends strong message on $150 crude
Crude oil was jumping again on Friday, March 6, on a warning from Qatar's energy minister that prices could soar much higher if the Persian Gulf can't be reopened.
The Gulf region produces above 20% of the world's crude oil and a similar amount of liquid natural gas. Nearly all of it reaches global customers via tankers passing through the Strait of Hormuz, which links the Persian Gulf to the Gulf of Oman and the Indian Ocean.
If that happens, crude oil prices might hit $150 a barrel in a few weeks, Qatar's Saad Sherida al-Kaabi told the Financial Times newspaper. Ultimately, he warned, the conflict in the Middle East — a key player in global energy supplies and shipping routes — could "bring down the economies of the world."
But the strait is effectively closed because Iranian naval forces are firing on ships, and maritime insurers are refusing cover losses in the event of attacks.
Related: J.P. Morgan revamps oil prices target for the rest of 2026
Crude oil jumps above $90
Oil prices are rising in reaction for a fifth straight day.
Light sweet crude, the benchmark U.S. oil, peaked at $92.61 a barrel, its highest level since the summer of 2022. It then fell back to $90.44, up 11.6% on the day.
Brent crude, the global benchmark, reached as high as $94.64 a barrel during the day, the highest level since August 2022. Then, it fell back to $92.30, up 8% on the day. That's up 52% for the year.
In addition to the runup in oil prices, retail gasoline prices are jumping. AAA said the U.S. national average price of gasoline reached $3.32 a gallon, up 11.3% on the week and nearly 17% this year.
Related: Gas prices surge 9% to highest level in 11 months
Gulf producers shutting down production
The runup began with the publication of an interview that al-Kaabi, the Qatari energy minister, gave to the Financial Times. The strait blockage is so bad that oil producers are planning to shut in production because they're running out of storage space.
Kuwait has already begun cutting output, The Wall Street Journal said.
That could stop all production in the Persian Gulf within days.
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How will the U.S react
Timing, then, is everything, and it's not clear if the United States gets the severity of the immediate problem. (The long-run expectation is for crude and gasoline prices to fall back if — and when — a ceasefire is achieved.)
President Donald Trump said this week he wants to approve whoever is nominated to be Iran's next leader. There has been no signal from Iran its leadership would even consider the idea.
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