Brent Breaks Below $100 as UAE Offers to Force Open the Strait of Hormuz

The UAE Gambit

The UAE formally petitioned the United Nations to authorize a range of measures, including military force, to reopen the Strait of Hormuz. Officials told reporters that Abu Dhabi is lobbying the U.S. and European and Asian nations to assemble a coalition, with the UAE offering mine-clearing operations and logistical support. If it joins, the UAE becomes the first Gulf Arab state to take a direct military role in the Iran conflict.

This is what tipped Brent below $100. The Strait has seen shipping traffic collapse 90–95% since the war began on February 28, choking off the passage that carries roughly 20% of global daily oil supply. A credible military reopening pathway gives the market a timeline it can price — and it is pricing aggressively.

Three De-Escalation Tracks in 72 Hours

The UAE push lands on top of a rapid convergence of channels that caught the oil market offsides. Trump claimed on Truth Social that Iran's president asked for a ceasefire, stating the U.S. would "consider" it once the Strait is open. Iran's Foreign Ministry called the claim "false and baseless," but Axios reported that back-channel discussions between Washington and Tehran are active, with three U.S. officials confirming a ceasefire-for-Hormuz framework is on the table.

Meanwhile, a surprise joint communiqué emerged late March 31 signaling a provisional maritime security agreement, and China and Pakistan published a five-point peace framework — the first formal multilateral peace plan since the war started. Whether any individual channel produces a deal is uncertain. What the market is responding to is their simultaneous existence.

What $14 of War Premium Looks Like Unwinding

Goldman Sachs had estimated the war premium at roughly $14 per barrel. From last week's $116 highs, Brent has already shed more than that — suggesting the market is now pricing in at least partial supply normalization. The Brent-WTI spread has compressed to 2026 lows, a sign that the Hormuz-specific disruption premium is eroding faster than the broader crude complex.

SEB analysts project Brent averaging $100 for the remainder of 2026, declining to $85 in 2027, assuming the Strait operates at 20% capacity through mid-May before full reopening. But Naeem Aslam of Zaye Capital Markets warned that "markets are betting on a quick diplomatic breakthrough" and that infrastructure damage, shipping delays, and residual risk could keep a floor under prices even if the conflict ends. Iran itself has said it is prepared for "at least six months" of war. The market is betting Tehran blinks before then.

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