Oil: Strait tensions keep upside risks alive – Danske Bank

FXStreetApr 20, 2026 7:14 AM

Danske Research Team highlights that Brent crude has rebounded toward USD 95/bbl as US–Iran tensions around the Strait of Hormuz intensify. They note that Oil is likely to stay volatile this week as negotiations continue and warns that if flows through the strait do not resume, prices could climb back above USD 100/bbl, with broader market implications.

Strait of Hormuz turmoil underpins Brent

"The Middle East conflict seesawed over the weekend, starting on Friday with Iran declaring the Strait of Hormuz open for the remainder of the 10-day US-brokered truce between Israel and Lebanon - a key Iranian demand. Brent crude closed at 90USD/bbl on Friday, buoyed by optimism surrounding a lasting peace deal."

"However, Iran quickly reversed course, re-closing the strait after the US confirmed its shipping blockade would continue. Tensions escalated further as Iran was accused of firing on vessels near the strait."

"The Middle East conflict escalated early this morning as the US intercepted an Iranian cargo ship trying to breach its maritime blockade, prompting Iran to vow retaliation. The prospects for a second round of negotiations remain uncertain ahead of the ceasefire's expiration on Tuesday, with Iran refusing to participate unless the blockade is lifted. "

"Meanwhile, the US Treasury has extended Russian oil sanctions exemptions by one month, casting doubt on Washington's confidence in a swift resolution."

"Oil prices rebounded, with Brent crude trading at USD 95/bbl this morning, as the market digested the turmoil around the Strait of Hormuz. The market is likely to stay volatile this week as US and Iran will try and negotiate a deal. If oil does not start flowing through the strait soon, oil prices are likely to rise further and above USD 100/bbl again. "

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

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