Iran: Oil prices climbed for a third straight session on Wednesday as renewed tensions between the United States and Iran fuelled concerns over global crude supplies. Markets reacted sharply after US President Donald Trump warned of further military action against Iran, raising fears of prolonged disruption in the strategically vital Strait of Hormuz.
Brent crude futures rose towards $86 per barrel, while US benchmark West Texas Intermediate (WTI) traded above $80, extending an 11 per cent rally over the previous two sessions.
Trump warns of more military action
The latest gains followed President Trump’s warning that the US could launch additional strikes on Iranian targets, including power plants and bridges, as early as next week if Tehran refuses to return to negotiations.
The renewed military stance came after Washington resumed its blockade of Iranian shipping through the Strait of Hormuz, one of the world’s busiest energy transit routes. The decision followed fresh US strikes aimed at limiting Iran’s ability to target commercial vessels passing through the waterway.
Strait of Hormuz remains in focus
Although Trump reversed his earlier proposal to impose a 20 per cent levy on cargo moving through the Strait of Hormuz, concerns over shipping security remain high. The decision offered some relief to shipping companies already facing increased risks due to the conflict.
Around 20 per cent of the world’s crude oil and liquefied natural gas passes through the Strait of Hormuz, making any disruption a major concern for global energy markets.
Supply fears continue to support prices
The conflict has intensified after recent attacks on oil tankers and Gulf infrastructure slowed shipping operations. Adding to regional instability, Yemen’s Iran-backed Houthi rebels launched ballistic missiles and drones towards Saudi Arabia, marking the most significant escalation since the 2022 ceasefire.
Meanwhile, industry data showed US crude oil inventories declined by 600,000 barrels last week. If confirmed by official government figures, it would mark the 11th inventory decline in the past 12 weeks, signalling resilient demand and providing further support to oil prices.
With geopolitical tensions remaining elevated and supply concerns mounting, analysts expect oil markets to remain highly volatile in the coming weeks.