Oil prices rally as Strait of Hormuz remains closed, blocking supply despite OPEC+ output hike.

Oil prices surged last week with June WTI crude hitting $110.93 and Brent reaching $120.54, driven by the ongoing closure of the Strait of Hormuz which is blocking 10-13 million barrels per day from reaching the market. Diplomatic talks between the U.S. and Iran remain deadlocked, with Iran demanding the lifting of the U.S. naval blockade before reopening the Strait. Despite OPEC+ agreeing to increase production in June, the supply deficit persists as the additional barrels cannot be exported. Market dips on ceasefire or diplomatic headlines are seen as temporary, with the fundamental supply disruption keeping prices elevated until the Strait reopens or a credible breakthrough occurs.