West Texas Intermediate crude futures topped $85 a barrel for the first time in nearly two years as conflict in the Middle East brought shipping through the Strait of Hormuz to a near-total halt. The surge came despite US President Donald Trump signaling "imminent action" to ease prices and the Treasury Department granting India temporary waivers to buy Russian oil.

With no end to hostilities in sight, Goldman Sachs warned that oil could top $100 a barrel if disruptions persist, while Qatar's energy minister predicted prices could reach $150 within weeks. The Strait of Hormuz, which typically carries about a fifth of global oil flows, has seen commercial traffic collapse due to security threats, insurance constraints, and operational uncertainty, according to the Joint Maritime Information Center.

European diesel futures are heading for a weekly gain of more than 50%, while Brent crude's prompt spread widened to $5.11 a barrel in backwardation. Saudi Arabia raised oil prices for Asian buyers by the most since August 2022, and China has instructed major refiners to suspend diesel and gasoline exports. With US gasoline prices hitting $3.32 per gallon, the Trump administration is weighing options including potential releases from the Strategic Petroleum Reserve.