Oil prices climb as US, Iranian attacks stoke fears of escalation

Oil prices are climbing amid fears of escalation in the Middle East following the first exchanges of fire between the United States and Iran in more than a month over the weekend. Brent crude, the international benchmark, rose more than 1 percent on Tuesday to top $91 a barrel, extending a more than 2.5 percent gain from the previous day. Brent scheduled for November delivery stood at $91.44 a barrel as of , up from just over $88 a barrel when markets closed on Monday.

The latest rise came amid renewed tensions in the Middle East following US strikes on Iran’s Larak ⁠Island and Iranian attacks on two bases used by US forces in Jordan. In a television interview on Monday, US President Donald Trump pledged to respond to Tehran’s strikes on the King Hussein and Al Azraq bases in Jordan. The United Kingdom Maritime Trade Operations, a monitoring centre operated by the British Royal Navy, reported late on Monday that a tanker was struck by three unknown projectiles while crossing the Strait of Hormuz, where Iranian forces have carried out numerous attacks on commercial shipping.

No casualties were reported in the attack, and no government or group has claimed responsibility. Oil prices have been volatile since a 60-day ceasefire between the US and Iran expired in mid-August, denting hopes of a return to pre-war levels of maritime traffic in the Strait of Hormuz, a conduit for about one-fifth of global oil supplies in peacetime. After peaking at nearly $94.40 a barrel on August 21, Brent has been trading in the range of $86-$91 since the truce between the sides lapsed without an extension or permanent peace deal.

Traffic in the Strait of Hormuz, which saw roughly 130 daily transits before the war, remains heavily constrained, with many vessels sailing “dark” with their Automatic Identification System turned off to lessen the threat of Iranian drones and missiles or interception by the US Navy. The strait saw 107 transits from August 24 to August 30, down from 121 crossings the prior week, according to ship monitoring platform MarineTraffic. Tony Sycamore, a senior market analyst at IG Markets, said oil prices could ease in spite of the latest flare-up in violence if “dark” shipments tick up again in the strait.