Dow, S&P 500, Nasdaq rise as Wall Street crosses fingers for Hormuz reopening

Oil prices held above $100 per barrel through Monday morning as key attacks from both sides of the Iran war targeted key infrastructure and showed no signs of an off-ramp for what has become the largest energy crisis since at least the 1970s.

ICE futures on Brent crude (BZ=F), the international pricing benchmark, held above $102 per barrel, while those on the US benchmark West Texas Intermediate (CL=F) traded above $95 after cracking the key $100 mark late Sunday night.

Over the weekend, key actions from both sides of the war pointed toward further escalation.

Late Friday night, the US struck a litany of military assets on Kharg Island, the Iranian regime’s primary oil export terminal, with threats to strike oil infrastructure on the island if the conflict continues. At the same time, drone strikes from Iran on Saturday and Monday have halted oil loadings at the key port of Fujairah in the United Arab Emirates as the conflict continues to threaten the wider Gulf region.

The Strait of Hormuz, the world’s most important shipping lane for oil, remains essentially closed to all but a handful of Indian liquefied petroleum gas tankers that made the crossing over the weekend. President Trump called on other world leaders to step up efforts to reopen the Strait of Hormuz, but those international partners deferred on taking concrete actions.

This week, global central bank meetings will take place, where leaders will have to grapple with whether the war in Iran remains transitory or risks becoming a drawn-out crisis.

“The result is a high stakes stalemate that markets are struggling to price,” Capital analyst Daniela Hathorn wrote in a client note Monday morning. “Energy flows remain significantly constrained, and as long as that persists, the risk of a prolonged global energy shock remains elevated.”