Brent Crude Surges Past $110 as US-Iran Talks Stall, Strait of Hormuz Remains a Flashpoint

May 18, 2026 — Global oil markets opened the week on a volatile note as Brent crude prices breached the $110-per-barrel mark in Asian trading, extending a seven-day rally fueled by stalled US-Iran peace negotiations and persistent disruptions in the Strait of Hormuz. The escalating tensions have tightened global energy supplies, pushing prices to levels not seen since April 2024, while traders brace for potential spillover effects from broader Middle East geopolitics.

Why Are Oil Prices Rising?

The primary driver behind the latest surge is the breakdown in diplomatic efforts between the US and Iran. After two months of conflict, peace talks have lost momentum, with US President Donald Trump reportedly rejecting Iran’s latest proposal to halt hostilities until disputes over Gulf shipping and nuclear discussions are resolved. The Iranian foreign ministry, led by Abbas Araqchi, has maintained that Tehran’s plan prioritizes an immediate ceasefire before addressing broader grievances.

Adding to the uncertainty, the Strait of Hormuz—a critical chokepoint for global oil flows—remains under pressure. Iran has continued to restrict shipping through the waterway, while the US has maintained its blockade of Iranian ports, effectively cutting off a significant portion of Middle East crude exports. According to the International Energy Agency (IEA), disruptions in the Strait have reduced daily oil throughput by approximately 1.5 million barrels, or roughly 2% of global demand.

Market sentiment has also been shaped by broader geopolitical risks, including escalating tensions between Israel and Lebanon. Analysts warn that any further deterioration in the region could exacerbate supply constraints, pushing prices even higher.

Key Market Moves: Brent vs. WTI

As of Monday’s trading, Brent crude futures for June delivery were trading at $110.30 per barrel, up nearly 1.2% from Friday’s close. The benchmark has now advanced for seven consecutive sessions, marking its longest streak since the 2023 Red Sea crisis. Meanwhile, US West Texas Intermediate (WTI) crude for June settled at $97.80 per barrel, a 0.8% increase, though the spread between Brent and WTI has widened due to regional supply disruptions.

In India, domestic crude oil prices on the Multi Commodity Exchange (MCX) surged to ₹9,250 per barrel, reflecting the global uptick. The rally has already driven gasoline prices higher in key consuming markets, with US retail prices approaching $3.80 per gallon, up from $3.50 just two weeks ago.

What’s Next for Oil Prices?

Short-term outlook remains cautious, with traders monitoring three critical developments:

• Diplomatic Breakthrough: Any sign of renewed US-Iran negotiations could ease supply fears, but experts at Bloomberg Intelligence rate the probability of a resolution in the next 30 days at just 20%.
• Strait of Hormuz Stability: If Iran fully reopens the waterway, Brent could retreat toward $105–$108. However, any further escalation—such as an attack on commercial shipping—could push prices toward $120.
• Central Bank Policy: Upcoming meetings by the US Federal Reserve, European Central Bank (ECB), and Bank of Japan will influence market liquidity. A hawkish pivot could offset some of the geopolitical premium.

Longer-term, the IEA warns that prolonged disruptions could accelerate the shift toward alternative energy sources, though the transition remains gradual. “The current spike is a reminder that geopolitical risks still dominate energy markets,” said Fatih Birol, IEA Executive Director. “Investors should prepare for volatility.”

FAQ: Your Questions Answered

1. Will gas prices keep rising?

Likely yes, at least in the short term. With Brent above $110, US retail gasoline prices are expected to hover near $3.75–$3.90 per gallon through June, according to the US Energy Information Administration (EIA).

2. Could oil hit $120?

Possible, but not guaranteed. Analysts at Reuters suggest a $120 benchmark would require a full closure of the Strait of Hormuz or a broader regional conflict.

3. How are OPEC+ countries reacting?

OPEC+ has not announced new production cuts, but sources close to the group indicate they are monitoring the situation closely. Saudi Energy Minister Prince Abdulaziz bin Salman has stated that the alliance remains “ready to act” if market stability is threatened.

Key Takeaways

• Brent crude has surged past $110, extending a seven-day rally driven by US-Iran tensions and Strait of Hormuz disruptions.
• Diplomatic efforts have stalled, with Iran insisting on a ceasefire before addressing nuclear or shipping disputes.
• Short-term risks include further supply tightness, while long-term trends may accelerate energy transition investments.
• Gasoline prices in the US are expected to remain elevated, nearing $3.80–$3.90 per gallon in coming weeks.

Looking Ahead

The next 30 days will be pivotal. If the Strait of Hormuz reopens and US-Iran talks resume, prices could stabilize. But if tensions escalate—or if new flashpoints emerge in the Middle East—oil markets could face even sharper volatility. For now, investors and consumers should brace for higher energy costs in the near term.

— Marcus Liu