Oil prices hit new wartime high before easing, as few signs of breaking stalemate with Iran

The damage of Brent rough oil color briefly surged yesteryear $126 US a drum overnight — the highest since March 2022 — before coming back down, as stalled U.S.-Iran talks raised doubts over the reopening of the Strait of Hormuz and a permanent end to the Mideast war.

Brent crude to be delivered in June then slid to $108.51 per barrel. Before the war began in late February, Brent crude was trading around $70 per barrel.

Benchmark U.S. Crude also slid back down, falling $2.37 US per barrel to $104.51 US.

Regardless, the price of gasoline is continuing to tick higher. In Canada, the average price for a litre of gas was $1.814 on Thursday morning according to GasBuddy — up 2.9 cents compared to yesterday, and up 46.4 cents compared to a year prior. Prices were highest in B.C., averaging just over $2 a litre.

There's no clear path to an end to the war, which has seen Iran throttle the Strait of Hormuz while the U.S. Blockades Iranian ports — pushing oil prices higher. Reports on Thursday suggesting a possible escalation by U.S. President Donald Trump doused hopes for a quick end to the conflict.

"The breakdown of talks between the U.S. And Iran, along with President Trump reportedly rejecting Iran's proposal for a reopening of the Strait of Hormuz, has the market losing hope for any quick resumption in oil flows," ING Bank strategists Warren Patterson and Ewa Manthey wrote in a research note.

Oil prices vary depending on the type of crude oil, where it is being traded and under what terms, for futures contracts. By some measures, Brent has hit its highest level since its peak of $147.50 US per barrel in 2008 during the global financial crisis.

Soaring oil prices pushed inflation higher in Europe in April. Annual inflation in the 21 countries that use the shared euro currency rose to three per cent from 2.6 per cent in March, fuelled by a 10.9 per cent increase in energy prices, the European Union statistical agency Eurostat reported Thursday.

ING's head of global macro Carsten Brzeski said another month of Hormuz disruption would likely trigger at least a technical euro zone recession.

In North America, stock markets glided higher early Thursday following more strong profit reports from big companies like Alphabet and Amazon despite the big movements in oil prices. The S&P 500 rose 0.3 per cent and inched closer to its all-time high set earlier this week. The Dow rose 271 points, and the Nasdaq composite added 0.5 per cent.

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In Europe at midday, Britain's FTSE 100 climbed 1.3 per cent after the Bank of England kept its main interest rate on hold at 3.75 per cent as policymakers assess the economic impact of the Iran war.

France's CAC 40 lost 1.1 per cent, and Germany's DAX traded 0.2 per cent lower.

Asian stocks mostly fell. Tokyo's Nikkei 225 shed one per cent and the Kospi in South Korea fell 1.4 per cent. Hong Kong's Hang Seng lost 1.3 per cent, and the Shanghai Composite index closed 0.1 per cent higher.

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