War on Iran | Crude oil prices surge to highest levels

Added: 2026-05-07

[00:00:00]The latest reports have heightened fears that the conflict involving the US, Israel, and Iran could escalate further.

[00:00:07]Currency risk strategist at Treasury One, Andre Botha, says the situation in the Middle East with the Strait of Hormuz effectively blocked has become problematic.

[00:00:17]Add to that the uncertainty of what happens now with the UAE that announced that they will be leaving OPEC. That throws another cat amongst the pigeons. At the same time, Mr. Trump also said that people and countries needs to prepare for a long duration of a Strait of Hormuz that will be closed.

[00:00:43]In other words, for a long duration of the impact of logistical movement of oil.

[00:00:51]And that increases prices tremendously.

[00:00:54]It makes the world very, very cautious.

[00:00:58]And hence the jump in oil prices to these unprecedented levels at this point in time.

[00:01:06]Meanwhile, markets analyst Warwick Lucas says in the short term markets can cope with expensive oil, but warns the situation is approaching a point where physical supply constraints could take over.

[00:01:18]The Strait of Hormuz has become a central bargaining leverage on both sides. You know, hence hence the uh the US blockade there. But I mean, even as we see interaction, um what the significance of that is is that now Iranian oil storage is full. So, that means they will have to shut their oil fields down soon. And if this gets resolved quickly, it doesn't mean that they that that oil comes back on the market and the price is full. It takes time to open an oil field again.

[00:01:49]At the same time, the rand has taken the brunt of the sell-off in riskier assets, falling to 16.90 to the dollar earlier on Thursday morning.

[00:01:59]Nthabeleng SABC News, Johannesburg.