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Oil prices surged on Wednesday after US President Donald Trump reimposed a naval blockade on all Iranian ports, triggering retaliatory Iranian strikes against US military infrastructure in the Middle East.
Brent crude jumped 1.72 per cent to $86.19 a barrel, while West Texas Intermediate (WTI) rose 1.4 per cent to $80.40 a barrel. Both benchmarks reached their highest levels since mid-June as the escalating conflict deepened global supply fears.
The US military launched a fresh round of airstrikes early Wednesday to degrade Iran’s ability to attack commercial shipping in the strategic Strait of Hormuz, which handles about one-fifth of the world’s oil and liquefied natural gas.
In response, Tehran claimed it closed the critical waterway, reigniting hostilities and shattering a fragile truce reached in June.
Trump further heightened market anxieties during a Fox News interview, warning that the US military will ultimately target Iranian energy infrastructure.
Meanwhile, Iran’s military launched drone and missile attacks targeting US assets at Jordan’s Azraq base as well as storage facilities in Bahrain and Kuwait.
Analysts warn that oil prices could march toward $100 a barrel if intensifying hostilities damage oil facilities around the Gulf.
However, market experts note that a diplomatic solution remains possible, as both nations still have strong incentives to avoid a full-scale war.
