Global oil benchmarks posted sharp gains on Friday, March 13, 2026, as the ongoing shutdown of a critical maritime chokepoint continued to strain worldwide supplies. Brent crude futures, the international benchmark, advanced by $1.59 to settle at $102.05 per barrel. In the United States, West Texas Intermediate (WTI) crude rose $1.15 to reach $96.88.
Historic Supply Disruption Unfolds
The primary catalyst for the rally remains the closure of the Strait of Hormuz, a vital passageway for seaborne oil exports from the Middle East. The International Energy Agency (IEA) has characterized the event as the most severe oil supply shock on record. The agency estimates global flows could decline by approximately 8 million barrels per day throughout March, sending price volatility soaring to levels reminiscent of the early pandemic era.
Market participants are grappling with the severe physical constraints. "Traders were being hammered by the news," noted Phil Flynn, an analyst at Price Futures Group. Emril Jamil of LSEG observed that Brent crude was finding stronger support than its U.S. counterpart, reflecting Europe's greater exposure to supply disruptions from the region.
Producers and Refiners React
Key oil-producing nations are taking action. According to sources cited by Reuters, Saudi Arabia has slashed its output by roughly 2 million barrels per day, reducing production to about 8 million bpd. This represents a significant drop from the 10.882 million bpd pumped in February, with cuts focused on major offshore fields like Safaniya and Zuluf. State-owned Saudi Aramco did not comment on the reported reductions.
On the demand side, major refiners are also scaling back. China's Sinopec, one of the world's largest refining companies, plans to cut its March crude processing volumes by over 10%. This translates to a reduction of 600,000 to 700,000 barrels per day, a move that follows Chinese government restrictions on exports of diesel, gasoline, and jet fuel to bolster domestic inventories.
Bank Forecasts Revised Sharply Higher
Financial institutions are rapidly updating their price projections in response to the sustained crisis. Goldman Sachs adopted an especially aggressive stance, raising its forecast for Brent crude to trade above $100 per barrel for March. The bank's updated model suggests prices could settle near $85 in April, but warns of a potential jump to $93 in the fourth quarter if the Hormuz disruption persists for two months. Its baseline Q4 targets now stand at $71 for Brent and $67 for WTI. Bank of America also revised its 2026 projections upward.
JPMorgan highlighted the severe physical market tightness, flagging nearly 12 million barrels per day in expected supply cuts by the end of the following week. The bank noted that commercial tanker traffic remains "extremely limited," with new shipments from the Gulf largely halted. It also pointed to growing shortages in refined products like diesel, jet fuel, LPG, and naphtha.
Policy Response and Future Uncertainty
Policymakers are attempting to temper the price surge. IEA Executive Director Fatih Birol referenced the agency's planned release of 400 million barrels from strategic petroleum reserves, stating it has already made a "strong impact" on the market. However, he cautioned that the world is navigating "an extremely critical period" following the chokepoint's closure.
Despite the week's powerful rally—Brent gained over 10% and WTI rose more than 7%—the sustainability of high prices is not guaranteed. The IEA notes that some Gulf exporters could potentially reroute shipments by April. Furthermore, looking ahead to the full year 2026, global oil supply might still outpace demand. Analysts suggest that if shipping lanes reopen and additional emergency barrels reach the market, the recent price gains could quickly reverse.
