Oil Prices Rise Nearly 3% as Strait of Hormuz Tensions Escalate

Oil prices rose nearly 3% on Tuesday to a four-week high as markets reacted sharply to the resumption of the US naval blockade of Iran and escalating military attacks in the strategic Strait of Hormuz.

Brent crude futures rose 1.8% to $84.80 per barrel, while US West Texas Intermediate crude gained 2.2% to $79.84. Both contracts reached their highest levels since mid-June, when the parties signed a short-term ceasefire agreement.

Acting on President Donald Trump’s orders, the US military carried out airstrikes against Iran for a third consecutive night. Trump also proposed imposing a mandatory 20% fee on ships passing through the strait to cover the cost of protecting the waterway.

Tensions were further heightened after Iranian cruise missiles struck two tankers from the United Arab Emirates in Omani territorial waters, killing an Indian sailor.

Analysts warned that any serious physical obstruction of tanker traffic through the key maritime chokepoint could trigger another sharp rise in global oil prices. Renewed missile attacks by Yemen’s Houthis on targets in Saudi Arabia are adding to the uncertainty.

(Reuters, Max)