Oil Prices Surge 5% as Trump Prepares Extended Iran Navy Blockade

Oil prices jumped more than 5% Wednesday, on a report that President Donald Trump is prepared to keep the U.S. Navy blockade of Iran in place for an extended period. International benchmark Brent crude futures rose more than 5% to $117.58 per barrel at 11:21 a.m. ET, U.S. West Texas Intermediate futures with June delivery rose more than 5% to $105.33 per barrel. Trump has decided in recent meetings to continue the blockade of Iran rather than resume bombing or walk away from the conflict, U.S. officials told The Wall Street Journal. The president has told his aides recently to prepare for an extended blockade to pressure Tehran, the officials said. Trump threatened Iran again on Wednesday in a Truth Social post, saying the country "better get smart soon!" and accusing Tehran's leadership of failing to "get their act together." Attempts to continue negotiations to end the war have stalled in recent days. Iran has refused to reopen the Strait of Hormuz until the U.S. lifts its blockade. Tehran's control of the strait has choked off oil exports from the Middle East. Energy market participants were also digesting the ramifications of the UAE's abrupt decision to quit OPEC, although analysts said the move was likely to have a limited market impact given the ongoing Middle East crisis. Strategists at Dutch bank ING said in a research note published Wednesday that the UAE's exit from the oil producer group represents "a big blow" to OPEC and would certainly be welcomed by Trump "as it erodes OPEC's influence in the oil market, while it should also be beneficial for importers and consumers." "However, in the near term, the biggest driver for oil prices remains developments in the Persian Gulf and the timing of a resumption in oil flows through the Strait of Hormuz," they added.