Oil prices surged on Thursday as Iran intensified attacks on oil and transport facilities across the Middle East, sparking fears of a prolonged conflict and potential disruptions to oil flows through the Strait of Hormuz.
Brent crude futures rose $4.47, or 4.86%, to $96.45 per barrel by 07:33 GMT, after briefly touching $100 earlier in trading.
U.S. West Texas Intermediate (WTI) crude climbed $4.05, or 4.64%, to $91.30 per barrel, reflecting heightened concerns over regional supply instability.
Brent had earlier hit $119.50 per barrel on Monday, its highest since mid-2022, before retreating following U.S. President Donald Trump’s remarks that the Iran war could end soon.
Iranian officials have warned that oil prices may continue to spike if tensions escalate further.
What they are saying
Market watchers say the oil price surge reflects continued uncertainty over regional security and the flow of crude through strategic chokepoints.
- “Get ready for oil to be $200 a barrel, because the oil price depends on regional security, which you have destabilised,” a spokesperson for Iran’s military command said on Wednesday, addressing the United States.
- ING analysts noted that there are currently no signs of de-escalation in the Gulf.
- “The only way to see oil prices trade lower on a sustained basis is by getting oil flowing through the Strait of Hormuz. Failing to do so means that the market highs are still ahead of us,” ING said, quoted by Reuters.
The statements highlight the fragility of global oil markets amid ongoing geopolitical tensions.
Get up to speed
Tensions between Iran and the U.S. have long influenced oil markets, particularly because the Strait of Hormuz channels about a fifth of the world’s oil supply.
Past conflicts and sanctions have repeatedly pushed prices higher, with Brent crude hitting multi-year highs whenever threats to the shipping lanes emerged.
Earlier this week, Brent’s spike to $119.50 per barrel marked the most significant surge since mid-2022, demonstrating how quickly market sentiment reacts to developments in the Gulf.
Historically, even brief threats to oil flows in the region have triggered price jumps that ripple through global energy markets.
More Insights
Recent attacks on vessels and facilities have intensified fears of disruption. On Wednesday, two foreign tankers carrying Iraqi fuel oil were attacked in Iraq’s territorial waters, causing fires.
- Farhan al-Fartousi, director general of Iraq’s General Company for Ports, confirmed the incidents to Reuters.
- Iraqi security officials reported that explosive-laden boats from Iran were suspected of carrying out the attacks.
These incidents underscore the vulnerability of maritime oil transport in the region and the potential for escalating price volatility.
What you should know
- To help stabilise oil markets, the International Energy Agency (IEA) has agreed to release a record 400 million barrels from strategic reserves.
- The United States is contributing the largest share, with 172 million barrels from its Strategic Petroleum Reserve.
- This coordinated release aims to offset supply concerns triggered by the U.S.-Israeli conflict with Iran.
