Oil tops $100 again despite historic release of reserves as war with Iran rages

By John Liu, CNN

(CNN) — Oil prices surged past $100 per barrel again overnight, three days after it hit a four-year high, as the US and Israel’s war with Iran continues to have a historic impact on global fuel supplies.

The jump came despite 32 countries, including the US and other developed economies, agreeing earlier on Wednesday to a record release of oil into the global market.

Brent crude, the global oil benchmark, hovered around $100 a barrel overnight Thursday, an 8.7% increase for the day. Meanwhile, WTI, the US benchmark, also soared 8.7% to $94.8.

As the conflict in the Middle East drags on, the Strait of Hormuz – a critical oil shipping route carrying roughly one-fifth of global daily oil production – remains effectively shut with Iran attacking ships trying to transit.

In response, Saudi Arabia – the world’s largest oil exporter – has to redirect its maritime trade to its western Red Sea ports to avoid the Strait. Many other Gulf nations have also seen their energy infrastructure attacked and have reduced their output.

Oil prices have witnessed huge volatility since the US and Israel struck Iran more than a week ago, spiking to nearly $120 per barrel for Brent crude on Sunday before cooling down in subsequent days.

On Wednesday, member countries of the International Energy Agency unanimously agreed to release 400 million barrels of oil – the largest release of emergency oil stocks in history.

The record amount far surpasses the 182 million barrels of oil that countries put onto the market in two tranches in 2022 when Russia launched its full-scale invasion of Ukraine.

But the return of oil prices above $100 suggests that the release does not appear to be sufficient in calming investors’ jitters over a continued energy disruption caused by the near-shutdown of the Strait of Hormuz.

Whether the price will remain above the $100 mark in the hours to come remains to be seen.

Oil majors typically hedge in the futures market during the day. Oil trades at night could fluctuate more because of thinner trading volumes and speculators playing their positions, resulting in turbulence like the surge to around $120 on Sunday night, which moderated during the US trading hours afterward.

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CNN’s Hanna Ziady and Nic Robertson contributed to this report.