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Physical Oil Prices Soar Past Futures as Hormuz Standoff Enters Week Three

Officials are signaling new reserve releases in response to forecasts of record‑threatening oil.

Overview

  • Brent settled near $112 a barrel, yet real‑world barrels are far pricier, with Oman above $162 and Murban above $145 as refiners pay steep premiums to secure supply.
  • Jet fuel has topped $200 a barrel and Asian buyers are pulling in cargoes from farther afield, underscoring how tight physical markets have become compared with paper futures.
  • Treasury Secretary Scott Bessent said the U.S. could pursue another strategic stockpile release and even consider easing some Iranian oil sanctions, while denying any intervention in futures trading.
  • Goldman Sachs and Citigroup warned futures could top the 2008 peak of $147.50 if disruptions persist, and Goldman outlined scenarios ranging from a Q4 2026 retreat toward $70 with a quick reopening to multi‑year recovery if flows stay constrained.
  • Consumers and businesses are feeling the squeeze, with U.S. gasoline averaging $3.91 a gallon, diesel above $5, airlines passing on higher costs or canceling flights, trucking firms facing margin strain, and stocks falling as bond yields rise.