Oil prices top $112 after Iraq declares force majeure, Kuwait refineries attacked

In this article

• @CL.1
• @LCO.1

Follow your favorite stocksCREATE FREE ACCOUNT

watch now

VIDEO7:2707:27

Brent crude could surpass $130 if the Strait of Hormuz remains closed, says Kpler’s Matt Smith

Squawk Box

Crude prices topped $112 on Friday after Iraq declared a force majeure at all oilfields operated by foreign companies and drones struck two refineries in Kuwait.

International benchmark Brent crude futures rose 3.26%, or $3.54, to close at $112.19 per barrel. U.S. crude oil gained 2.27%, or $2.18, to settle at $98.32 per barrel.

Iraq oil ministry sources told Reuters that Baghdad had declared the force majeure because it cannot ship crude through the Strait of Hormuz. Oil tanker traffic through the Strait has plunged due to attacks by Iran.

Drones also struck the Mina Al-Ahmadi and Mina Abdullah refineries in Kuwait on Thursday. The attack on the Mina Al Ahmadi refinery resulted in a fire in several units, prompting a precautionary shutdown of some parts of the facility, according to the Kuwait Petroleum Corporation.

Saudi oil officials expect crude prices could climb above $180 a barrel if Iran war disruptions last through late April, the Wall Street Journal reported.

U.S. Treasury Secretary Scott Bessent said Washington may soon lift sanctions on Iranian crude stored aboard tankers — a move aimed at easing price pressures following Iran’s closure of the Strait.

“In the coming days, we may unsanction the Iranian oil that’s on the water, about 140 million barrels,” Bessent told Fox Business Network.

He said bringing the sanctioned Iranian crude back into global markets would help cap prices over the next 10 to 14 days.

Stock Chart IconStock chart icon

Israeli Prime Minister Benjamin Netanyahu also told reporters that Israel is assisting U.S. efforts to reopen the Strait of Hormuz, according to wire reports. He added that Iran no longer has the capability to enrich uranium or produce ballistic missiles, adding that the war could end sooner than many expect.

Citi said the Iran conflict has driven a sharp rally across oil and related commodities, prompting it to lift its near-term price outlook.

The bank now expects Brent and WTI to climb to $120 per barrel over the next one to three months, and to $150 per barrel in a bull-case scenario if disruptions intensify.

Still, its base case assumes de-escalation within four to six weeks, which would allow Brent to ease back to $70–$80 by year-end.

At the same time, key crude spreads have widened sharply, with Citi raising its Brent-WTI forecasts to reflect elevated freight costs and strong U.S. Gulf Coast demand for inland barrels.

Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.