Global oil prices climbed sharply on Thursday, with Brent crude futures nearing the $100-per-barrel threshold as renewed tanker attacks and escalating military tensions in the Middle East intensified concerns regarding global energy supplies.
According to CNBC, Brent crude futures for July delivery gained 4.6% to reach $98.44 per barrel, marking their highest level since late May. U.S. West Texas Intermediate (WTI) crude futures rose approximately 3.8% to $90.14 per barrel, also reaching their highest point since June 8. The surge put both benchmarks on track for their third-largest monthly gains in a decade, with Brent crude on course for a 35.3% monthly increase and WTI heading toward a 30% rise.
Escalation in the Strait of Hormuz
The market volatility follows reports of attacks on tankers near the coast of Saudi Arabia and a breakdown of the U.S.-Iran ceasefire. AA reported that the UK Maritime Trade Operations agency confirmed a tanker caught fire after being struck approximately 70 nautical miles southwest of the Saudi port of Al Shuqaiq. Yemen’s Houthi group claimed responsibility for the incident, citing a maritime blockade against Saudi Arabia.
These hostilities have raised fears that supply disruptions could spread from the Strait of Hormuz to the Red Sea and the Bab al-Mandab Strait. Under normal conditions, approximately 20% of the world’s oil and natural gas traded globally passes through the Strait of Hormuz, according to AP News.
U.S.-Iran Military Standoff
The U.S. military announced on Wednesday that it was conducting a 12th night of strikes against Iran. President Donald Trump has issued a direct warning to Tehran, stating that the U.S. would destroy an Iranian bridge or power plant in response to any attacks on ships in the Strait of Hormuz.
From this point forward, any time the Islamic Republic of Iran shoots at a ship in the Strait of Hormuz, whether it be by Missile, Rocket, Drone, or any other device or weapon, the United States will bomb and destroy ONE BRIDGE OR POWER PLANT, Trump said
Iran has responded by threatening to retaliate against U.S.-linked infrastructure and energy assets across the region if such strikes are carried out. Analysts warn that the core issue of who administers and ensures passage through the strait remains unresolved, creating a volatile environment for energy markets.
Economic Impacts and Market Outlook
The rise in oil prices is placing renewed pressure on global stock markets and inflation expectations. According to AP News, higher energy costs threaten a reacceleration of inflation, which may force the Federal Reserve and other central banks to maintain or raise interest rates. This prospect has negatively impacted equity markets, with major European indices, including Germany’s DAX and France’s CAC 40, seeing declines in early trading.
Market analysts suggest the outlook remains highly dependent on diplomatic efforts. The recent rally in oil reflects renewed concerns over the Strait of Hormuz after the breakdown of the U.S.-Iran ceasefire,
HSBC noted. Some analysts, including those cited by Fxempire, warn that if the disruption to shipping routes becomes severe and prolonged, oil prices could potentially climb toward $120 per barrel.
Conversely, some regional markets are navigating the supply uncertainty alongside local operational shifts. In Nigeria, fuel marketers have resumed loading petrol and diesel from private depots following a week-long disruption, even as the country monitors the impact of international crude prices on domestic refining and fuel costs, according to the Guardian.
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