Foreign Affairs

Oil Hits Four Year High As Iran Negotiations Continue

Oil pump (Screen Capture/PBS NewsHour)

Oil briefly hit $126.41 a barrel early Thursday as market volatility tied to the Iranian conflict continued.

The global oil benchmark Brent crude hit its highest price since 2022 before dropping back to $110 a barrel. Prices have risen dramatically from the pre-Operation Epic Fury $73 a barrel standard. 

U.S. gasoline prices move in tandem with Brent crude. For every $10 increase in Brent crude prices, U.S. gasoline rises by roughly 24 cents a gallon. Gas has risen from around $2.80 to $4.30 per gallon since Iran shut the Strait of Hormuz in relation to U.S. strikes.

Brent previously crested at $139.18 a barrel in March 2022 after the Russian Federation invaded Ukraine, according to U.S. Energy Information Administration data. Thursday’s peak represents the highest spot price per barrel since. Oil’s spot price is the cost to purchase a barrel immediately, rather than in a future contract.

Vice President JD Vance led the last round of negotiations with Iranian leadership in Pakistan beginning April 11. No agreement was ultimately reached.

“I think that’s bad news for Iran much more than it’s bad news for the United States of America,” Vance said at the time.

President Donald Trump responded to the negotiations’ failure by blockading the Strait of Hormuz on April 12, effectively halting unapproved naval traffic through the area.

“I have also instructed our Navy to seek and interdict every vessel in International Waters that has paid a toll to Iran. No one who pays an illegal toll will have safe passage on the high seas,” Trump announced that day in a Truth Social post. “Any Iranian who fires at us, or at peaceful vessels, will be BLOWN TO HELL! Iran knows, better than anyone, how to END this situation which has already devastated their Country.”