WTI crude futures surged 11.24% to $111.54 per barrel on April 2, the largest single-session gain in six years. Brent rose 7.78% to $109.03. US retail gasoline hit $4.08/gallon regular, $5.51 diesel.
What triggered it: Trump’s prime-time address promised “extremely hard” strikes over the next 2-3 weeks and threatened to hit “each and every” Iranian power plant simultaneously. Markets had sold off ahead of the speech on de-escalation hopes (Brent fell from $118.60 war high to ~$100 on April 1). When the speech delivered escalation instead of a ceasefire framework, crude detonated.
Why it matters: WTI closed above Brent ($111.54 vs $109.03), an unusual inversion signaling US crude is pricing as the global “safe barrel.” With ~8.5M bbl/day of Gulf production offline, Saudi bypass maxed, and the April 6 energy strike deadline 3 days away, the market sees no path to physical relief. Insurance premiums have jumped to 5-10% of hull value. The IEA’s SPR release covers ~15% of lost flow. OPEC spare capacity that can reach market is functionally zero.
What to watch: April 6 deadline (3 days). Whether WTI-Brent inversion persists. Brent trajectory toward $115-120 if April 6 strikes execute.