Brent crude drops below $110 after volatile rally above $120

Brent crude fell below $110 per barrel on Thursday, pulling back sharply after briefly surpassing $120 a day earlier, as extreme volatility continued to shake global oil markets amid the ongoing Iran war and Strait of Hormuz disruption.

Prices retreat but risks persist

The international benchmark declined more than 1.4% to approximately $108.9 by 1118GMT, following recent gains driven by supply concerns linked to the conflict and uncertainty over energy flows through the strategic waterway. Despite the pullback, risk premiums remained elevated as traders monitored the scale and duration of the US blockade on Iranian ports, tanker traffic restrictions, and any potential diplomatic progress between Washington and Tehran.

Markets watch for supply normalization

Oil and gas flows from the Gulf remain severely constrained, keeping markets highly sensitive to any developments around the chokepoint. Any prolonged disruption raises concerns about tighter global supply, higher shipping costs, and renewed inflationary pressure. Thursday’s decline also reflected profit-taking after the previous day’s surge, while uncertainty over demand, inventories, and possible emergency supply responses continued to drive sharp price swings.