Crude Oil Prices Surge 7% After U.S. Navy Blockade Order

On April 13, 2023, crude oil prices experienced a 7% increase after U.S. President Donald Trump directed the Navy to initiate a blockade of the Strait of Hormuz, a critical waterway through which 20% of the world's oil passes.

This order came in response to the collapse of negotiations between the U.S. and Iran, as confirmed by Vice President JD Vance during a press briefing. Following Trump's announcement, Brent crude futures traded at $101.91 per barrel, while West Texas Intermediate rose to $104.16 per barrel.

The blockade is set to take effect at 10:00 AM the following day. The rise in oil prices follows a significant decline on April 8, when a ceasefire was reached between Iran and the U.S.

The situation has led to a cascading effect on prices in Nigeria, with major oil contracts dropping below $95 per barrel, and subsequent increases in transportation and logistics costs affecting staple commodities.