18APR

Brent at $112 as Houthis enter the war

2 min read

14:57UTC

Oil climbed 4.2% to $112.57 as the Houthi attacks added a second chokepoint threat to a market already pricing in near-total Hormuz closure.

← Back to Hormuz opens and closes in 24 hours Jump to analysis ↓

ConflictAssessed

Key takeaway

Brent's 51% monthly gain reflects dual-chokepoint risk not yet fully priced by markets.

Brent Crude settled at $112.57 on 28 March, up $4.56 (4.22%), driven by Houthi entry into the conflict ¹. WTI crossed $100 for the first time since the Houthi escalation began. The monthly gain of approximately 51% is the largest single-month increase since the COVID recovery in mid-2021. Goldman Sachs estimates a $14 to $18 per barrel geopolitical risk premium is already baked into the price.

The Majlis Hormuz toll bill is expected to be finalised this week. Passage would embed Hormuz control in Iranian domestic law, making it constitutionally harder for any future negotiator to concede the point. The de facto $2 million per-voyage toll is already operational, denominated in Chinese yuan, with refusal to pay triggering boarding by IRGC naval forces. IEA demand destruction (growth revised down 210,000 barrels per day) suggests the price surge is partly offset by recession-driven demand collapse .

Deep Analysis

In plain English

Oil has risen 51% in 29 days, from about $67 per barrel before the war to $112.57. For comparison, petrol in the UK is now roughly £3.50 to £3.70 per litre where it was under £2.20 before the conflict. The immediate driver is the near-total closure of the Strait of Hormuz, through which 20% of the world's oil normally flows. The Houthi entry into the conflict on 28 March added another 4.22% to the price in a single day. The Iranian parliament is expected to pass a law this week making the Hormuz toll permanent under Iranian domestic legislation. If it does, markets will likely price in a longer-term disruption, pushing prices higher still.

Source Landscape

This story draws on mixed-leaning sources from United States

United States

Primary parallel: The 1973 Arab oil embargo produced a 300% price increase in five months. The current 51% increase in 29 days is faster in velocity but remains lower in absolute terms. Both events triggered recessions in oil-importing economies.

Counter-parallel: In 1973, the US had no domestic shale production; the energy transition had not begun; and there were no strategic petroleum reserves of comparable scale. The IEA's 400 million barrel release is a buffer the world did not have in 1973.

Brent's 51% monthly gain represents the largest single-month increase since mid-2021. The Majlis toll bill, expected to pass this week, would embed a $2 million per-vessel toll structure in Iranian domestic law. Passage would likely trigger a further market repricing as the duration premium on the disruption extends.

At $112.57 per barrel, UK retail petrol prices are approximately £3.40 to £3.70 per litre depending on refinery margin assumptions. Goldman Sachs's $14 to $18 geopolitical risk premium implies the underlying commodity cost would fall to $94 to $98 if the conflict ended tomorrow. The IEA's demand revision of -210,000 b/d signals early recession pressure that may widen if prices remain elevated through May.

Consensus view: Goldman Sachs commodity research and JP Morgan energy strategy desks both identify a $14 to $18 per barrel geopolitical risk premium in current Brent pricing above fundamentals, noting that markets are not yet pricing the full demand-destruction scenario because the war's duration remains uncertain.

Counter-view: Saudi Aramco's investment committee and OPEC Secretariat economists warn that the recession signal in IEA demand data (-210,000 b/d revision) may accelerate faster than the geopolitical premium sustains; a demand-driven price collapse could occur simultaneously with supply disruption.

Key tension: Whether the Majlis Hormuz toll bill passage this week, converting de facto IRGC control into domestic law, will force markets to price in a permanent rather than temporary Hormuz disruption, triggering the next price surge.

Sources:International Energy Agency·CNBC

Mentions:Strait of Hormuz →Iran →Islamic Revolutionary Guard Corps (IRGC) →International Energy Agency →Majlis →

First Reported In

Update #51 · Iran hits aluminium plants; Hormuz emptying

International Energy Agency· 29 Mar 2026

Read original →

Causes and effects

Caused by

Brent at $112 as Houthis join the war

Brent's 4.22% surge to $112.57 reflects the compounding economic impact of Houthi entry into the conflict adding demand-side uncertainty.

Occurred 28 Mar 2026

Read story →

This Event

Brent at $112 as Houthis enter the war

Brent's 51% monthly gain is the largest since the COVID recovery in mid-2021, and the Majlis Hormuz toll bill expected this week could convert the de facto closure into permanent law.

Led to

Brent above $116, set for record month

Brent at $112.57 on 28 March (ID:1695) advanced further to above $116 by 30 March, driven by Trump's oil seizure statement and the third consecutive Houthi attack on Israel.

Occurred 30 Mar 2026

Read story →

Different Perspectives

Hengaw and Iranian protest detainees

Hengaw documented three secret executions of protest-linked detainees at Isfahan and Karaj on 15 and 16 July, including Mohammad Amini Dehaghani, hanged over a January arson charge with no public trial record. Tehran is carrying out capital punishment against 2026 protesters while global attention stays fixed on the war with the US.

Russia

OFAC named Moscow aviation firm Avratek OOO and its principals Mariya Selina and Vadim Druzhbin directly for the first time in this war's Iran arms track, under an Executive Order 13382 designation issued 15 July. The designation converts years of rhetorical claims about Russian arms supply to Iran into named, sanctionable individuals and a documented company.

Bahrain

Bahrain sounded air-raid sirens during Iran's 14 July Gulf-wide barrage and was struck again in the 16 July Artesh claim against Sheikh Isa air base, home to the US Fifth Fleet. Manama's air-defence stocks were already reported near-exhausted before this second strike claim against the same base in a week.

Kuwait

Kuwait's armed forces intercepted the drones Iran's Army claimed against Ali Al Salem air base on 16 July and separately reported intercepting missiles and drones in Iran's Gulf-wide barrage on 14 July. Kuwait now absorbs strikes from two rival Iranian commands while hosting Camp Arifjan, the US logistics base Iran also claims to have destroyed.

Iran (Artesh and IRGC)

Iran's regular Army claimed the 16 July drone strikes on Kuwait's Ali Al Salem and Bahrain's Sheikh Isa air bases under its own banner, Operation Saeqeh phase ten, while the IRGC separately claimed a mine strike closing Hormuz on 18 July. Two Iranian institutions are now claiming parallel operations, with neither claim confirmed by Kuwait, Bahrain or CENTCOM.

United States

CENTCOM bombed the interior cities of Ahvaz and Yazd for the first time overnight into 17 July, Marines began boarding vessels including the tanker Wen Yao, and Treasury let General License X1 lapse at 12:01am the same day. Washington closed every remaining channel for de-escalation without a new executive action, a posture of attrition rather than a wind-down.