The debate around oil prices returning to $100 per barrel has resurfaced after Iraq began shutting down production at key southern oil fields, including the massive Rumaila Oil Field, as tanker movement through the Strait of Hormuz remains effectively stalled due to escalating tensions across the Middle East.
Production at West Qurna 2 Oil Field is also being curtailed, with about 460,000 barrels per day already shut in, according to Iraqi state agencies. Officials say the reductions are largely due to logistical disruptions rather than direct damage from regional strikes. With tanker traffic severely restricted and navigation through the Gulf disrupted, storage tanks at southern export terminals are nearing capacity, forcing producers to scale back output to avoid operational bottlenecks.
At the same time, a drone strike targeted the Port of Fujairah in the United Arab Emirates. The port is one of the region’s largest oil export hubs and is located outside the Strait of Hormuz, making it a critical route for shipments bypassing the chokepoint. While no major structural damage has been confirmed, the incident has heightened concerns about the vulnerability of Gulf energy infrastructure.
The Strait of Hormuz handles roughly one-fifth of global oil shipments, meaning any prolonged disruption to traffic through the waterway could significantly tighten global crude supply, particularly for Middle Eastern exports destined for Asian markets.
Oil prices have already reacted to the rising geopolitical risk. As of 09:00 PM Pakistan Standard Time on Tuesday, Brent crude futures climbed more than 7 percent to $83.4 per barrel, while West Texas Intermediate futures rose 7.65 percent to $76.7 per barrel. Analysts say sustained disruptions in shipping or further production cuts could quickly push prices closer to the $100 per barrel level.
