Oil prices rose nearly 3% on Tuesday to their highest in four weeks, as the United States reimposed its naval blockade of Iran while the two countries stepped up attacks in the Strait of Hormuz, heightening uncertainty about energy flows.
Brent crude futures were last up $1.90, or 2.3%, to $85.20 per barrel at 0630 GMT, while U.S. West Texas Intermediate crude rose $1.91, or 2.4%, to $80.05 a barrel.
Both contracts earlier rose more than $2 a barrel before paring some gains, while Brent had surged 9.6% in the previous session, its biggest daily gain since May 2020.
Oil prices are now at their highest since the two countries signed a Memorandum of Understanding (MoU) to end the war on June 17, 2026.
The U.S. military carried out a third consecutive night of strikes against Iran on Monday, as U.S. President Donald Trump reinstated a blockade of Iranian shipping and proposed charging a 20% fee to guard the Strait of Hormuz.
Latest developments in US-Iran war
The United Arab Emirates Ministry of Defence said on Monday that two UAE tankers were hit by two Iranian cruise missiles in the southern lane of the Strait of Hormuz in Omani territorial waters, killing one Indian crew member and wounding eight others.
KCM Trade chief market analyst Tim Waterer told Reuters: “The latest escalation, including the U.S. reinstatement of the blockade and Iranian responses, has clearly injected fresh risk into the market.
“While a full closure hasn’t occurred, the competing objectives of both sides have made the supply picture highly uncertain.”
Shipping data on Monday also showed the number of tankers transiting the Strait of Hormuz fell in the past day to the lowest level in two months.
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