Trump Vows to Escalate Iran War on April 2, Sending WTI Above $108 and Brent Past $109

Oil markets closed sharply higher on Wednesday after President Trump delivered a national address vowing to intensify military operations against Iran, dashing hopes of a near-term diplomatic resolution. Brent crude settled near $109.38 per barrel while West Texas Intermediate finished the session above $108, with both benchmarks surging more than eight percent late in the day as equity futures sold off in parallel.

Trump April 2 Address Pushes WTI Up 4.7% in Final Trading Hour to US$108.43

Markets had entered Wednesday pricing in a small probability of an off-ramp in the U.S.-Iran conflict. Instead, Trump pledged to hit Iran "extremely hard" and ruled out any near-term ceasefire talks. WTI climbed more than $10 per barrel in the hours following the address. S&P 500 futures fell 1.5 percent, Dow futures lost 1.4 percent, and Nasdaq futures dropped nearly 2 percent as traders rotated toward safe-haven assets and energy. Analysts at several desks noted the speech effectively closes the door on a diplomatic resolution before the OPEC+ meeting Sunday.

Hormuz Remains Closed; IEA Considers Second Emergency Release

The Strait of Hormuz has now been effectively closed to regular commercial tanker traffic for more than a month, producing what the International Energy Agency has described as the largest single supply disruption in the history of global oil markets. Roughly 4.5 to 5 million barrels per day have been removed from supply, with IEA Executive Director Fatih Birol warning Wednesday that April will be much worse than March.

The agency's first emergency stock release of 400 million barrels, announced in mid-March, has proven insufficient to cap the price surge. The IEA is now assessing whether to authorize a second coordinated release. The U.S. Department of Energy has also initiated a separate Strategic Petroleum Reserve emergency exchange. Saudi Arabia and the UAE are rerouting barrels via overland pipelines, but these provide only partial relief given the scale of the disruption.

Analysts at several research houses are modeling scenarios that put Brent above $125 by late April if the strait remains closed, with some outlier forecasts approaching $200 per barrel if disruptions extend into May.

For context on how prices reached current levels, see earlier coverage: WTI Tops $100 as Hormuz Crisis Widens WCS Discount and Brent Stabilizes Near $92 After IEA Emergency Reserve Deployment.

OPEC+ Meets Sunday Ahead of Potential Further Output Hike

The OPEC+ eight-member group, comprising Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman, is scheduled to meet Sunday, April 5. Two delegates told reporters the group is weighing a further production increase, building on the 206,000 barrels per day added for April delivery at the March meeting.

Any increase would have minimal near-term market impact while Hormuz remains closed, but would carry symbolic weight: it positions member nations to rapidly boost supply once tanker traffic resumes. The announcement is expected to be framed as a commitment to market stability, a message aimed at consuming nations seeking relief from elevated prices.

Closing Prices: April 2, 2026

• Brent Crude: $109.38/bbl (USD), up approximately 8 percent on the session
• WTI (West Texas Intermediate): $108.20/bbl (USD), up more than 8 percent
• WCS (Western Canada Select): Estimated $96.20/bbl (USD), based on an approximately $12/bbl differential to WTI; approximately C$133.80/bbl at the USD/CAD rate of 1.3912
• Natural Gas (Henry Hub): $2.88/MMBtu (USD)

The USD/CAD exchange rate closed near 1.3912, meaning Canadian producers are receiving roughly C$150 per barrel in WTI-equivalent terms, a significant improvement from the sub-C$110 range that characterized much of 2025. Alberta operators including Suncor Energy and Canadian Natural Resources are direct beneficiaries, though hedging programs and capital discipline commitments temper the near-term windfall for most producers.

Occidental Completes Carbon Management Pivot; Majors Mixed

Amid the macro volatility, Occidental Petroleum finalized its strategic transformation into a carbon management company earlier this year, including the completed sale of its OxyChem chemicals division to Berkshire Hathaway. ExxonMobil slid 5.23 percent Wednesday as broader equity market weakness weighed on integrated majors despite elevated crude prices. Phillips 66 fell 3.59 percent. The divergence between upstream-focused producers and integrated refiners is emerging as a key theme for Q1 earnings season.

Canadian integrated producers remain favorably positioned as non-Middle East suppliers. See recent analysis: North American Refiners Post $22 to $28 Crack Spreads on $100 WTI.

April 3 Outlook: IEA Emergency Meeting, Golden Pass LNG First Cargo, and Baker Hughes Rig Count

The two key variables to monitor are any updated IEA guidance on a second emergency reserve release and early signals from OPEC+ delegates ahead of Sunday's meeting. Tanker routing data from vessel-tracking services will also be closely watched for any signs of Hormuz reopening. A resumption of even partial tanker traffic through the strait would likely trigger a sharp near-term correction, while continued closure keeps the price floor elevated through the coming week.