Oil prices rose more than $1 a barrel on Monday as tit-for-tat strikes between the U.S. and Iran on vessels sailing in the Strait of Hormuz and other areas heightened concerns of a prolonged supply disruption from the Middle East.
Brent crude futures climbed $1.20, or 1.25%, to $97.48 a barrel by 0727 GMT while U.S. West Texas Intermediate crude was at $92.62 a barrel, up $1.14 cents, or 1.25%.
Brent rose 7.8% last week while WTI gained nearly 10% after the U.S. and Iran resumed attacks and caused a reduction in oil flows through the Hormuz strait where a fifth of the world’s oil supply used to transit.
U.S. forces struck three Iranian oil tankers on Saturday, U.S. Central Command said, including one off the coast of Kharg Island, near Iran’s key oil export hub.
READ: US, Iran trade oil tanker strikes as Hormuz confrontation escalates
The navy of Iran’s Islamic Revolutionary Guard Corps said on Saturday it targeted three oil tankers that were travelling through unauthorized routes in the Strait of Hormuz as well as three additional U.S. vessels in other areas.
The Saturday attacks represented a “major escalation in the maritime conflict,” maritime intelligence firm Marisks said.
“Commercial tankers are now being deliberately used as instruments of reciprocal economic pressure, substantially weakening the previous distinction between military confrontation and commercial shipping,” it added.
An average of 10 commodity ships transited the Strait of Hormuz per day over the past 10 days, the lowest since May, data from analytics firm Kpler showed on Monday.
“If tanker traffic begins to slow materially, the market could price in a much larger supply shock. And there are already signs that this is happening,” said Priyanka Sachdeva, head of market insights at Phillip Nova.
A restricted zone will be announced outside the Strait of Hormuz in coming days, Mohsen Rezaei, the secretary of Iran’s Supreme National Security Council, said on Sunday, according to state media.
READ: Shockproof South Africa before oil strikes again
OPEC+ kept its oil output policy unchanged for October at a meeting on Sunday, the producer group said in a statement, as it needs to agree new quotas before deciding its next output steps.
A prolonged standoff, punctuated by calibrated military action by the U.S. and Iran, appeared to be the most likely scenario and was likely to delay the path to full recovery of Middle East supply, ANZ analysts said in a note.
“We then expect exports to remain constrained through the rest of 2026, before a gradual reopening late in Q4 2026,” they said, adding that a return to pre-war throughput is not expected until late first quarter or early second quarter of 2027.
- Oil prices rose over $1 a barrel on Monday due to tit-for-tat strikes between the U.S. and Iran in the Strait of Hormuz and surrounding areas.
- Brent crude futures increased by $1.20 to $97.48 a barrel, while U.S. West Texas Intermediate crude rose by $1.14 to $92.62 a barrel.
- The U.S. struck three Iranian oil tankers on Saturday, while Iran's Revolutionary Guard Corps targeted three oil tankers and three U.S. vessels.
- An average of 10 commodity ships transited the Strait of Hormuz daily over the past 10 days, the lowest since May, according to analytics firm Kpler.
- OPEC+ kept its oil output policy unchanged for October, and analysts predict exports to remain constrained through 2026 with a full supply recovery not expected until early 2027.
Oil prices rose more than $1 a barrel on
Brent crude futures climbed $1.20, or 1.25%, to $97.48 a barrel by 0727 GMT while U.S. West Texas Intermediate crude was at $92.62 a barrel, up $1.14 cents, or 1.25%.
Brent rose 7.8% last week while WTI gained nearly 10% after the U.S. and Iran resumed attacks and caused a reduction in oil flows through the Hormuz strait where a fifth of the world's oil supply used to transit.
U.S. forces struck three Iranian oil tankers on Saturday, U.S. Central
READ: US, Iran trade oil tanker strikes as Hormuz confrontation escalates
"Commercial tankers are now being deliberately used as instruments of reciprocal economic pressure, substantially weakening the previous distinction between military confrontation and commercial shipping," it added.
An average of 10 commodity ships transited the Strait of Hormuz per day over the past 10 days, the lowest since May, data from analytics firm Kpler showed on
"If tanker traffic begins to slow materially, the market could price in a much larger supply shock.
A restricted zone will be announced outside the Strait of Hormuz in coming days, Mohsen Rezaei, the secretary of Iran's Supreme National Security Council, said on
READ:
OPEC+ kept its oil output policy unchanged for October at a meeting on
A prolonged standoff, punctuated by calibrated military action by the U.S. and Iran, appeared to be the most likely scenario and was likely to delay the path to full recovery of
"We then expect exports to remain constrained through the rest of 2026, before a gradual reopening late in Q4 2026," they said, adding that a return to pre-war throughput is not expected until late first quarter or early second quarter of 2027.
