Explained: Why crude oil prices are eyeing $100 once again despite Iran war ceasefire

Just when investors began to breathe easy on hopes that a two-week ceasefire would cool oil prices, markets were jolted back to reality, with crude once again hovering near the $100 mark. The sharp 15% drop on Wednesday, triggered by an initial wave of optimism, proved short-lived. Within a day, sentiment flipped as doubts over the fragile truce resurfaced, pushing oil prices higher amid fresh concerns that supplies through the critical Strait of Hormuz could remain constrained.

On April 9, Brent crude futures rose $3.69, or 3.9%, to $98.44 a barrel at 0856 GMT, while U.S. West Texas Intermediate crude gained $3.47, or 3.7%, to $97.88 a barrel. Despite that, analysts said traders are reluctant to fully remove the geopolitical risk premium, as there is still little clarity on how ongoing U.S.-Iran discussions may impact oil flows.

What’s behind investor anxiety?

Fuelling investor unease is US President Donald Trump’s latest post on Truth Social. He said U.S. military assets, including ships, aircraft and personnel, will remain stationed in and around Iran, along with additional ammunition and weaponry, until a final agreement is fully honoured.


He warned that if the terms are not upheld, military action would resume on a much larger scale, although he said such a scenario is unlikely. Trump also reiterated that it had long been agreed that Iran would not possess nuclear weapons and that the Strait of Hormuz would remain open and secure. In the meantime, he said the U.S. military is maintaining readiness while awaiting ‘their next conquest’.

Further, concerns over the ceasefire persist, particularly after Israel continued strikes on Lebanon on Wednesday. In response, Iran said it would be “unreasonable” to move forward with talks aimed at a lasting peace agreement. Shipping companies have also expressed caution, saying they require more clarity on ceasefire terms before resuming movement through the strait. Iranian media reported that Tehran has issued navigation maps to help vessels avoid mines and follow designated safe routes.

At the same time, risks to regional energy infrastructure remain elevated. Iran has reportedly carried out strikes on sites in neighbouring countries after the ceasefire, including a pipeline in Saudi Arabia that has been used as an alternative route to bypass the Strait of Hormuz, according to an industry source.

The chances of a meaningful reopening of the strait in the near term appear low. The Strait of Hormuz is a critical route for global energy trade, linking supplies from major Gulf producers such as Iraq, Saudi Arabia, Kuwait and Qatar to international markets. It typically carries around 20% of the world’s oil and gas supply.

$100 per barrel in sight?

International brokerage Macquarie has said that even if tensions ease in the near term, oil prices are likely to find support in the $85–$90 range, with a gradual move back toward $110 until normal flows through the Strait of Hormuz resume. The note added that if disruptions persist through April, Brent could still climb to $150 per barrel.

Market experts are of the view that oil may be transitioning into a structurally higher price regime. Ajit Mishra, Senior Vice President at Religare Broking, echoed the view and noted that the ceasefire is limited to two weeks and a full return to pre-war levels of $70–$75 could take months. In the near term, he does not expect a sharp correction, pegging crude in the $80–$85 range on the downside and $95–$100 on the upside.

Analysts also claim that if ongoing tensions persist, the outlook for crude oil remains volatile and tilted upward. Continued conflict in the Middle East, especially disruptions around the Strait of Hormuz, would keep supply chains constrained, pushing Brent and WTI prices higher and sustaining inflationary pressures worldwide.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)