MOSCOW (dpa-AFX) - Oil prices rose above $100 per barrel on Monday as the U.S. military announced that it will implement a blockade in the Strait of Hormuz beginning 10 a.m. ET Monday, as ordered by President Donald Trump, after the weekend peace talks in Pakistan failed.
US Central Command said its forces will begin enforcing the blockade impartially against vessels of all nations entering or departing Iranian ports and coastal areas, including all Iranian ports on the Arabian Gulf and Gulf of Oman.
CENTCOM made it clear that its forces will not impede freedom of navigation for vessels transiting the Strait of Hormuz to and from non-Iranian ports.
Additional information will be provided to commercial mariners through a formal notice prior to the start of the blockade, CENTCOM said in a press release. All mariners are advised to monitor Notice to Mariners broadcasts and contact U.S. naval forces on bridge-to-bridge channel 16 when operating in the Gulf of Oman and Strait of Hormuz approaches, it added.
Sending signals of escalation in the Middle East war, Iran Revolutionary Guards said any military vessel approaching the Hormuz strait will be considered as violating the two-week U.S.-Iran ceasefire, and 'dealt with severely.'
Iran said last week that transit of vessels through the Strait of Hormuz came to a complete halt alleging that Israel violated the ceasefire in Lebanon.
The news of U.S. blockade and the failure of peace talks escalated concerns that the global energy crisis will deepen, putting immense pressure on the global oil market.
Oil prices had fallen sharply last Wednesday with markets responding positively to news of the United States and Iran agreeing to a two-week ceasefire on the Middle East war, and Brent crude oil price decreased by about 13 percent to $94.30 a barrel.
On Monday, Brent crude price went up by more than 7 percent and crossed $102 a barrel, while the US-traded WTI rose by more than 7 percent to $103.70 in morning trading hours.
Meanwhile, Saudi Arabia has reportedly restored its pumping capacity through its East-West pipeline to the Red Sea, and production from the Manifa oil field is back to normal.
In a separate development, TASS quoted Russian government spokesman Dmitry Peskov as saying that Russia is willing to export natural gas to Europe if there are any volumes left from increased exports to other markets.
The European Union's declared policy is to decrease dependence on Russian energy and a complete ban on imports by the end of 2027.
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