In his speech, Trump urged countries that need oil from the Middle East to now take the lead to keep the Strait of Hormuz open.
Global oil prices jumped after United States President Donald Trump’s address to the nation on Wednesday night, where he failed to mention any deadlines for the Iran war.
Trump, in his speech, deviated from his initial objective of seizing control of the Strait of Hormuz and asked other nations to “grab it”.
Benchmark Brent crude traded at over $105 per barrel soon after Trump’s address to Americans, where he underlined oil production capacities of the US and Venezuela, and called for countries to buy oil from the US.
Hailing US’s oil production capacity, Trump said, without accounting for the millions of barrels it is receiving from Venezuela, “Because of our ‘Drill, Baby, Drill’ program, America has plenty of gas, we are the number one producer of gas and oil on the planet, we have produced more gas and oil than Saudi Arabia and Russia combined, and that number will soon be substantially higher than that.”
“There’s no country like us anywhere in the world, and we’re in great shape for the future,” he emphasised.
Trump added: “The United States imports almost no oil through the Strait of Hormuz and won’t be taking any in the future. We don’t need it…”
The price of benchmark Brent crude was trading at about $100 a barrel before the President started speaking. While it fluctuated during the address, it is now heading higher and is currently up by around 4% at $105.38.
The West Texas Intermediate (WTI) crude is currently trading at $103.47 per barrel.
In his speech, Trump urged countries that need oil from the Middle East to now take the lead to keep the Strait of Hormuz open. He said: “To those countries that can’t get fuel, many of which refuse to get involved in the decapitation of Iran… build up some delayed courage, go to the Strait and just take it. Protect it.”
“They must grab it and cherish it. They can do it easily. We will be helpful, but they should take the lead in protecting the oil that they so desperately depend on,” he added.
The Strait of Hormuz is significant to the global economy as around 20% of the world’s energy usually passes through the narrow shipping lane, BBC noted.
Tehran blocked the maritime chokepoint between the Persian Gulf and the Gulf of Oman, following the US-Israeli attack on February 28.
The disruption to this crucial shipping lane — which accounts for a fifth of global energy flows — has set off the worst energy shock the world has seen, including sending global fuel prices spiralling.
