“Fire” in the price of oil, touching $120 a barrel: G7 finance ministers hold an emergency meeting

The soaring oil prices and the escalating war between the United States, Israel and Iran have caused severe turbulence in international markets.

With the price of Brent recently approaching $120 per barrel and shipping in the Strait of Hormuz effectively disrupted, investors and governments are facing a new wave of energy stress and increased inflation.

The price of US crude WTI rose by around 30%, while Brent strengthened by around 27%, with the two key international benchmarks now above $116 a barrel. The rise is mainly attributed to panic in the markets due to the ongoing conflict in the Middle East and the effective blockade of the Strait of Hormuz.

Brent rose as much as 29%, reaching $119.50 a barrel, recording the biggest intraday jump since 2020. Similarly, US West Texas Intermediate gained as much as 31%. This new surge added to the already strong gain of the previous week, when prices had strengthened by around 28%.

Extraordinary meeting of G7 finance ministers

According to a report in the Financial Times, the G7 finance ministers are to consider a joint release of oil from strategic reserves, in coordination with the International Energy Agency (IEA).

Citing sources with knowledge of the discussions, the newspaper said the ministers will hold a teleconference on Monday at 8:30 a.m. New York time (3:30 p.m. GMT) to consider the possibility of a coordinated intervention in the energy market.

According to the same report, three G7countries – including the United States- have already expressed support for this strategy.

The possible move is being considered at a time of intense turbulence in global energy markets, as geopolitical tensions and disruptions in oil flows have heightened concerns about supply adequacy and inflationary pressures worldwide.