22MAY

Brent hits $111.16, a new post-war high

4 min read

10:57UTC

London Brent settled $111.16 a barrel on 28 April, up 2.71% in a session, as the UAE OPEC announcement and the absence of any signed US ceasefire text both fed the same trade.

← Back to Istanbul talks, refineries dark, deficit overruns Jump to analysis ↓

ConflictDeveloping

Key takeaway

Brent crude printed $111.16, a 75.67% year-on-year gain, on the same Tuesday the UAE announced OPEC exit.

Brent Crude settled at $111.16/bbl on 28 April 2026 in London, up 2.71% in a single session from $108.11 on 27 April . The contract printed a new post-war high inside the same trading session that produced the United Arab Emirates OPEC exit announcement and the third Truth Social post from Donald Trump asserting Iran had told him it was collapsing. Axios found no Iranian confirmation and no accompanying State Department readout.

Brent Crude is the North Sea benchmark used to price roughly two-thirds of the world's oil contracts. The 28 April rally bundled two catalysts: the UAE exit removed a moderating voice on bloc production cuts at the moment CENTCOM's blockade was logging 37 vessels redirected , and the Pakistan-brokered ceasefire text arrived in Washington with no signed US response. Fortune reported the Brent settlement and confirmed US average gasoline at $4.18/gallon, the highest since the war began on 28 February. The year-on-year gain on Brent stands at 75.67%, a war premium that translates to roughly $1.80 more per US gallon than American drivers paid a year ago, or an extra $25 to $30 per fill on a typical 50-litre tank.

Markets priced the policy vacuum, not the diplomatic activity. Day 60 closes against an unbroken zero-instrument record ; the price arc since Day 17, which closed at $100.21 Brent and $3.79 US gasoline, has run alongside that empty signing column. The barrels that would normally cap a war-driven price rally remain trapped behind a closed Hormuz, while Abu Dhabi's stranded barrels sit outside the bloc's quota framework after Friday. Even a ceasefire text signed before the War Powers Resolution clock expires this Friday would not by itself unlock the barrels: the structural premium needs Hormuz transits restored and an OPEC+ quota framework that, after Friday, no longer includes Abu Dhabi.

European drivers face a similar premium; airlines are repricing fuel-surcharge bands across the Atlantic and the Gulf. The London close at $111.16 will set every Asian opening through 1 May.

Deep Analysis

In plain English

When the price of oil rises sharply, everything that needs energy to make or move it gets more expensive: petrol, diesel, jet fuel, heating oil, and then, with a delay, food and manufactured goods. On 28 April oil hit $111.16 per barrel, the highest since this war started. Two things happened on the same day: the UAE announced it was quitting the OPEC oil producers' club, and there was still no signed agreement to end the war or reopen the Strait of Hormuz. Traders pushed prices up sharply because both signals pointed to continued supply disruption.

Deep Analysis

Root Causes

Two structural conditions underpin Brent's persistent elevation above $100 since the war began on 28 February. First, the Hormuz blockade has removed roughly 18-19 mb/d of potential throughput from global markets on a daily basis, even after shadow-fleet rerouting offsets approximately 1.2 mb/d of Iranian crude to Chinese refiners.

Second, OPEC+ production discipline had been eroding since mid-2025 as member states including Iraq and Kazakhstan consistently exceeded quotas; the UAE exit on 28 April removes the most quota-compliant Gulf producer and signals the discipline mechanism may be terminally compromised.

Goldman Sachs estimated a pre-war structural supply deficit of $12-15/bbl entering 2026, driven by underinvestment in upstream capacity during 2020-23. The war layered a $35+/bbl geopolitical risk premium on top of that pre-existing deficit, producing a compound price level that will not fully unwind even if Hormuz reopens.

What could happen next?

Risk
If Brent holds above $110 through May OPEC ministerial discussions, Gulf state revenue projections diverge sharply between Saudi Arabia (benefiting from higher prices but facing cartel fragmentation) and UAE (maximising volume without a price floor), setting up a post-war oil-market structure with no dominant institutional anchor.
Consequence
US gasoline at $4.18/gallon, combined with broader inflation, creates electoral pressure on the Trump administration to release Strategic Petroleum Reserve volumes or negotiate a faster Hormuz reopening, both of which carry diplomatic costs.

Source Landscape

This story draws on centre-leaning sources from United States

United States

LeftRight

Primary parallel: The 1990 Gulf War oil shock offers the closest modern analogue. When Iraq invaded Kuwait on 2 August 1990, Brent rose from $17/bbl to $46/bbl within three months, a 170% gain driven by the combined removal of Iraqi and Kuwaiti output (about 4.3 mb/d) from a market with limited spare capacity.

The UAE exit now threatens to add unconstrained Emirati volume to a market already priced for scarcity, which is the inverse mechanism, but the institutional break that drove the 1990 shock, a founding OPEC member openly defecting from cartel discipline during a Gulf conflict, is structurally identical.

Counter-parallel: Unlike 1990, Saudi Arabia retains roughly 2-3 mb/d of genuine spare capacity and has a direct institutional incentive to stabilise prices by deploying it. In 1990 Riyadh moved quickly to fill the Kuwait-Iraq gap; the same mechanism exists today, meaning the 1990 parallel predicts a price ceiling set by Saudi intervention rather than an unconstrained spike.

The 75.67% year-on-year gain in Brent translates to approximately $63/bbl of cumulative war premium since the conflict began on 28 February at around $63/bbl baseline. Kpler's flow data for Q1 2026 shows Iranian export volumes at roughly 1.2 mb/d reaching Chinese refiners via shadow fleet routing despite the blockade, meaning the physical supply disruption is smaller than headline Brent implies.

For European importers, the $111.16 Brent level triggers automatic fuel-duty relief clauses in France, Germany and Italy, which were written for $90+ scenarios but have never been activated in wartime conditions. The Brent curve is in backwardation (spot above forward), suggesting the market views the current premium as temporary, with December 2026 futures trading around $95. That backwardation limits the inflation pass-through to contracts priced on front-month fixing.

Consensus view: Goldman Sachs commodities research (Daan Struyven, April 2026) places the 75.67% year-on-year Brent gain within a dual-shock framework: a geopolitical disruption premium of roughly $35/bbl layered on top of a structural supply-deficit premium of $12-15/bbl that pre-dated the conflict. Their base case targets $115-120/bbl if Hormuz remains effectively closed through the end of May.

Counter-view: The Quincy Institute for Responsible Statecraft argues the price signal is being distorted by futures-market positioning rather than physical scarcity: shadow fleet volumes of 153.7 million barrels documented by Windward on 15 April (84.9% China-bound) indicate more Iranian crude reaching end markets than the Brent front-month contract implies. Under this reading, the $111 level reflects trader sentiment and speculative positioning rather than a genuine supply removal.

Key tension: Whether the $111.16 settlement reflects a real physical supply withdrawal that will feed through to end-user shortages within 30-60 days, or whether shadow fleet routing and Chinese import absorption mean the geopolitical premium will compress once positioning unwinds.

First Reported In

Update #83 · UAE quits OPEC, war signs nothing

Fortune· 29 Apr 2026

Read original →

Causes and effects

Caused by

Brent $108 as CENTCOM seizes more tankers

Brent's $111.16 close on 28 April extended the $108.11 prior-day close recorded in ID:2856.

Occurred 27 Apr 2026

Read story →

UAE quits OPEC effective 1 May

UAE OPEC exit announcement on 28 April directly drove Brent's 2.71% rise to the $111.16 post-war high.

Occurred 28 Apr 2026

Read story →

This Event

Brent hits $111.16, a new post-war high

Brent's year-on-year gain stands at 75.67%, the largest war premium since the 1990 Gulf invasion. US average gasoline at $4.18/gallon is the highest since the war began on 28 February, and the UAE's exit removes the mechanism that has historically capped post-war price rallies. The premium will outlast a ceasefire if one lands.

Led to

Brent settles at $123, new wartime high

Brent $126 intraday high advances from the $111.16 post-announcement high set on Day 60 (ID:2873)

Occurred 30 Apr 2026

Read story →

Different Perspectives

Rafael Grossi, IAEA Director General

Grossi's Update 349 of 7 May recorded a drone strike on ZNPP's radiation monitoring laboratory on 3 May. Rosatom's 17 May public attack on the Secretariat's neutrality degrades the diplomatic ground Grossi needs for the sixth repair ceasefire at day 60 on the single backup line.

Indian Government / Embassy Moscow

The Indian Embassy in Moscow confirmed on 18 May that an Indian national was killed and three hospitalised at a refinery construction site in the 17 May barrage. India is among the largest buyers of discounted Russian crude; the fatality forces a diplomatic protest without changing the purchasing posture.

Recep Tayyip Erdogan, Turkish President

Erdogan met Zelenskyy in Ankara for nearly three hours on 15 May before the Istanbul session, recovering Turkey's 2022 mediator role and reducing Trump's leverage by hosting bilateral talks without Washington in the room. Turkey hosts the NATO Ankara summit on 7-8 July; the Istanbul format gives Erdogan standing at both tables simultaneously.

Viktor Orban / Hungarian Government

Budapest's new cabinet, formed 12 May, holds the institutional veto point on the EU tranche disbursement ahead of the first-half June window. Hungary has previously leveraged EU loan tranches to extract bilateral concessions; the combination of a fresh cabinet and a tight disbursement timeline makes Budapest the single highest-leverage actor in the EU track this fortnight.

European Council / Commission

The Commission is preparing a three-document disbursement package for the 9.1-billion euro first tranche of the EU loan to Ukraine, targeting first-half June, but delivery depends on the Magyar cabinet, which formed on 12 May, not blocking the mechanism. The 20th sanctions package remains in force against Russia.

Donald Trump / US Treasury

Treasury issued GL 134C with a 48-hour gap after GL 134B expired, confirming the waiver series functions as permanent monthly management rather than a wind-down instrument. Washington was absent from the Istanbul room; Treasury Secretary Bessent framed the Cuba carve-out as protecting 'most vulnerable nations', maintaining the fiction that the 30-day bridge has a humanitarian rationale.