Oil prices experienced a volatile session on Monday, as market participants reacted to U.S. President Donald Trump's declaration of an initiative aimed at freeing ships stranded by the ongoing closure of the Strait of Hormuz. This development comes amid heightened tensions between Tehran and Washington.
International benchmark Brent crude futures saw a slight dip of 0.35%, trading at $107.77 per barrel. Similarly, U.S. West Texas Intermediate (WTI) futures declined by 0.57% to $101.31 per barrel.
The critical Strait of Hormuz, which previously facilitated the transit of approximately one-fifth of global energy supplies, has been largely paralyzed due to its current blockade. Adding to concerns, the United Kingdom Maritime Trade Operations (UKMTO) reported on Monday that a tanker was struck by projectiles north of Fujairah in the UAE, highlighting the significant risks faced by vessels operating in the region.
President Trump announced on his Truth Social platform that the U.S. would launch "Project Freedom" to extricate civilian ships flagged by non-belligerent nations from the waterway, enabling them to resume their business operations. This initiative is slated to commence on Monday, Middle East time. The U.S. Central Command stated that U.S. military support for "Project Freedom" will include guided-missile destroyers, over 100 aircraft, advanced unmanned platforms, and 15,000 service members.
Traders are also closely monitoring the recent decision by OPEC+ to increase oil output by 188,000 barrels per day. This marks the cartel's first output adjustment since the departure of the United Arab Emirates, a key member.
