BY COMFORT OGBONNA
Oil prices climbed sharply on Tuesday, reaching their highest level in four weeks as renewed military tensions between the United States and Iran increased fears over possible disruptions to global energy supplies.
Brent crude futures rose $1.68, or 2%, to $84.98 per barrel by 0051 GMT, while U.S. West Texas Intermediate (WTI) crude gained $1.65, or 2.1%, to $79.79 per barrel. The increase followed a major surge in the previous session, when Brent crude jumped 9.6% — its largest single-day gain since May 2020.
The latest rise pushed oil prices to their highest level since the United States and Iran agreed to a memorandum of understanding aimed at ending the conflict on June 17. Investors have become increasingly concerned that renewed hostilities could threaten shipping routes and restrict the movement of crude oil from the Middle East.
Tensions escalated after two United Arab Emirates oil tankers were reportedly struck by Iranian cruise missiles in the southern section of the Strait of Hormuz, within Omani territorial waters. According to the UAE Ministry of Defence, the attacks killed one Indian crew member and injured eight others.
The Strait of Hormuz is one of the world’s most important energy routes, with a significant portion of global oil shipments passing through the narrow waterway. Any prolonged disruption could have major consequences for international oil markets and fuel prices.
U.S. President Donald Trump told reporters that Washington had reinstated a naval blockade targeting Iranian shipping. He also said the United States should receive compensation for protecting countries that rely on security support in the Strait of Hormuz.
“The latest escalation, including the U.S. reinstatement of the blockade and Iranian responses, has clearly injected fresh risk into the market,” said Tim Waterer, chief market analyst at KCM Trade.
He added that while the Strait of Hormuz had not been completely closed, the conflicting objectives of the United States and Iran had created significant uncertainty about future oil supplies.
Military activity continued to increase, with U.S. Central Command announcing another night of strikes against Iran. Meanwhile, Iran’s semi-official YJC news agency reported that explosions were heard in the port city of Bandar Abbas and on Kish Island early Tuesday.
Additional concerns emerged after Yemen’s Houthi movement launched missiles toward Saudi Arabia following accusations that Riyadh had carried out an attack on an airport under Houthi control.
Analysts warned that any expansion of regional attacks toward Saudi Arabia’s oil infrastructure or Red Sea shipping routes could create further risks for global crude supplies.
“If the Houthis extend their attacks to Saudi crude products in the Red Sea, it could put further uncertainties on crude flows from the region,” said Simon Wong, a portfolio manager at Gabelli Funds.
Beyond geopolitical concerns, traders are also monitoring U.S. inventory data for signs of changes in domestic oil demand and supply conditions. A preliminary market survey indicated that U.S. crude oil stockpiles were expected to have declined during the previous week, while gasoline and distillate inventories were likely to have increased.
With Middle East tensions escalating and markets closely watching developments around the Strait of Hormuz, oil prices are expected to remain highly sensitive to any further military actions or diplomatic changes that could affect global energy flows.
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