Iran's Khark Island Attacked, International Oil Prices Gradually Stabilize Above the 100-Dollar Psychological Mark

Caixin News, March 14 — (Editor: Feng Yi) As the US-Iran conflict continues to escalate, international oil prices initially pulled back but have once again risen to around $100 per barrel. Due to the uncertain outlook of the situation, the probability of oil prices stabilizing at this key psychological level is gradually increasing.

On March 13, international oil prices continued to rise. WTI April crude futures closed up $2.98, a 3.11% increase, at $98.71 per barrel, with a weekly gain of over 8.59%. Brent May crude futures rose $2.68, a 2.67% increase, to $103.14 per barrel, with a weekly increase of over 11.27%, after reaching $119.50 on March 9.

On the news front, U.S. President Trump posted on social media on the evening of the 13th that U.S. forces had heavily bombed Iran’s oil export hub, Hormuz Island, but chose not to destroy the island’s oil infrastructure.

Data shows that Hormuz Island, located in the northwest of the Persian Gulf, is Iran’s largest oil export base, responsible for handling 90% of Iran’s national oil exports.

This news was quickly confirmed by Iran. On March 14, Iran’s Fars News Agency reported that during the enemy airstrikes on Hormuz Island, there were over 15 explosions. The enemy attempted to damage defenses, military bases, helicopter hangars, and other facilities on the island, but the oil infrastructure was not damaged.

The Iranian armed forces’ headquarters stated that if Iran’s oil, economic, and energy infrastructure were attacked, they would destroy equivalent U.S.-related facilities.

Additionally, a retired U.S. military officer said in an interview that the attack on Iran’s Hormuz Island has increased the risk of war and could ultimately cause oil prices to go “out of control.”

Why is the market sensitive to $100 oil?

Earlier, the Speaker of Iran’s Parliament said that if the conflict further expands to the infrastructure level, international oil prices could remain in triple digits for some time. Iran even told the U.S. that it is prepared for oil prices to reach $200 per barrel. U.S. Energy Secretary Jennifer Granholm, after announcing a series of measures to ensure supply, said that oil prices are unlikely to rise to $200 per barrel.

Goldman Sachs economists analyzed that the main transmission channel of Middle East conflicts to the U.S. economy is oil prices. They expect Brent crude futures in London to average $98 per barrel in March and April, which is already 40% higher than the 2025 average.

In a previous baseline scenario, Goldman Sachs also predicted that if oil prices rise to $100 per barrel, global GDP growth would be dragged down by 0.1 percentage points, and overall inflation would be pushed up by 0.2 percentage points.

Currently, inflation concerns have become one of the market’s most worrisome derivative risks, alongside energy supply issues. Global markets are increasingly focused on “stagflation trading.”

On Friday, interest rate swap contracts linked to the Federal Reserve’s policy meeting showed that swap traders are no longer 100% certain that the Fed will cut rates this year. Overnight, swap traders only expected a 17 basis point rate cut this year — less than a single 25 basis point cut.

An overseas fund manager said they are increasing cash holdings because if the Middle East crisis persists for a long time, the probability of recession or stagflation will inevitably rise.

In a report on March 13, Guoxin Securities also stated that given the uncertain situation of the US-Israel-Iran conflict, international crude oil prices are expected to remain high and volatile. As the Strait of Hormuz blockade prolongs, the mid-term oil price center will continue to rise.