Oil prices rose by more than $1 per barrel on Monday after military tensions between the United States and Iran escalated in and around the Strait of Hormuz, raising fresh concerns over global energy supplies and the security of one of the world’s busiest oil shipping routes.
Reuters reported that global oil markets reacted after US forces struck Iranian missile launchers on Larak Island in the Strait of Hormuz, prompting Tehran to launch retaliatory military action. The exchange has heightened fears of a wider regional conflict that could disrupt commercial shipping through the Gulf.
Brent crude and US West Texas Intermediate (WTI) futures both gained more than $1 a barrel as traders priced in the risk of supply disruptions. Analysts said markets remain highly sensitive to any escalation involving the Strait of Hormuz, which carries roughly 20% of the world’s daily oil consumption.
The conflict has also begun affecting maritime traffic. Shipping companies have reduced vessel movements through the strait as security risks increase, while insurers are reassessing premiums for tankers operating in the Gulf.
The latest escalation comes after Iran’s Islamic Revolutionary Guard Corps (IRGC) said a large oil tanker struck two sea mines and caught fire while attempting to use the southern shipping lane of the Strait of Hormuz. The IRGC warned that vessels using the route without following Iranian naval instructions could face similar consequences.
The tanker incident followed the US strike on Larak Island, where Washington said it targeted Iranian missile launchers allegedly preparing rockets carrying sea mines. Tehran condemned the attack and described its subsequent actions as retaliation against US military operations in the region.
The Middle East conflict has now entered its sixth month, with investors closely watching whether further attacks on tankers, ports or energy infrastructure could trigger a broader disruption to global oil supplies and push crude prices even higher.
