by Coinstrooper Crypto Articles
Quick Take
  • Brent crude climbed more than 3% on Monday to its highest level since mid-June, as the US-Iran war chokes shipping through the Strait of Hormuz.
  • The US hit Iran for an eighth straight night over the weekend.
  • Washington has blockaded Iranian ports, and Tehran says the strait is closed to unauthorized ships.
  • Brent traded near $91.40 early Monday, up 3.2%, according to Trading Economics data.

What Happened

Oil just broke $90. Brent crude climbed more than 3% on Monday to its highest level since mid-June, as the US-Iran war chokes shipping through the Strait of Hormuz.

The US hit Iran for an eighth straight night over the weekend. Washington has blockaded Iranian ports, and Tehran says the strait is closed to unauthorized ships.

US President Donald Trump ended that truce on July 8. The war premium came right back.

Market Context

Why the Oil Price Is Climbing So Fast

Brent traded near $91.40 early Monday, up 3.2%, according to Trading Economics data. That caps a 14% jump last week. Crude has now rebounded nearly 30% from its early-July low near $71.

Here is the problem. US prices fell 0.4% in June, the biggest monthly drop since April 2020, because energy got 5.7% cheaper, BLS data shows. Oil at $90 runs that math in reverse.

“Prices are too high,” Kevin Warsh stated.

The post Oil Price Tops $90 as Iran War Escalates: What It Means for Crypto appeared first on BeInCrypto.

Why It Matters

The rally has a clear trigger. A June 17 truce between Washington and Tehran had reopened the strait, and oil slid from above $107 in May to $71.

Why the Fed May Hike Instead of Cut

Silver already slumped as the oil shock lifted Fed hike bets. Economists also expect an ECB rate hike in September.

None of this helps crypto. High rates hurt risk assets, and Bitcoin (BTC) is struggling to hold its recovery, with sellers fading every bounce, BeInCrypto analysis shows.

Now all eyes turn to July 28 and 29. If oil holds above $90, a Fed hike could move from tail risk to base case.

Details

The strait carries about a fifth of the world’s oil, and traffic is now thin. Kuwait said Iranian strikes hit a power and water plant twice in two days, Al Jazeera reported.

The damage is reaching US wallets too. BeInCrypto recently showed how the Hormuz oil shock is undoing June’s drop in inflation.

Bonds fell as oil jumped. The 10-year Treasury yield sits near 4.55%, close to a two-month high.

The Federal Reserve is already leaning hawkish. New Chair Kevin Warsh held rates steady in June, and nine of his 18 colleagues see higher rates this year. At a central-bank forum in Portugal on July 1, Warsh kept it short.

Traders noticed. Hike odds for the July 28 to 29 meeting doubled to 36% from 18% in early July. As of this writing, it was 14%, per CME FedWatch data, still elevated.

What This Means for Bitcoin

The war itself has not helped either. A BeInCrypto study of the first phase, from February 28 to June 17, found stocks beat BTC as the strongest war hedge.