Oil prices climbed sharply on Thursday as renewed military action between the United States and Iran revived concerns about energy supply disruptions across the Middle East.
Brent crude moved further above the $100-per-barrel level, while US West Texas Intermediate also posted strong gains.
Brent Crude Climbs Above $104
Brent crude futures rose around 3.5% to $104.81 per barrel by 09:41 ET.
Meanwhile, WTI crude gained roughly 3.5% to $99.46 per barrel.
The latest rally extended gains from earlier in the week and highlighted growing investor concern about the security of major oil shipping routes.
US-Iran Strikes Renew Supply Fears
Oil prices accelerated after the United States and Iran carried out their largest attacks on shipping since the conflict began in February.
The renewed fighting followed a tense period of relative calm through much of August.
Iran said it targeted 10 vessels in and around the Strait of Hormuz on Wednesday. The United States responded by striking five Iranian oil tankers.
The escalation immediately raised fears that disruptions to oil exports from the Persian Gulf could become more severe.
Strait of Hormuz Flows Remain Disrupted
Energy flows through the Strait of Hormuz remain well below pre-war levels.
The narrow waterway is one of the world’s most important energy transit routes, making any disruption particularly significant for global oil markets.
Persistently reduced traffic has kept traders focused on the risk of tighter supply and prolonged volatility in crude prices.
Any further deterioration in shipping conditions could place additional upward pressure on Brent and WTI prices.
Houthi Attacks Add to Middle East Tensions
Supply concerns have also expanded beyond the Strait of Hormuz.
Yemen’s Iran-backed Houthi movement has targeted energy infrastructure in Saudi Arabia, increasing worries about shipping through the Bab al-Mandeb Strait.
The route is another critical passage for oil shipments from major Gulf producers.
The combination of pressure around Hormuz and Bab al-Mandeb has increased concerns that the conflict could affect several important energy transport corridors at the same time.
Analysts Warn of Longer-Lasting Oil Disruptions
ANZ analysts said the continuing exchange of attacks suggests that oil flows from the Persian Gulf could remain disrupted for an extended period.
They also warned that the widening conflict could create even deeper supply problems for a market already struggling to adjust to reduced flows.
Persistent geopolitical risk is therefore becoming an increasingly important driver of oil prices.
Uncertainty Over Duration of Iran Conflict
Uncertainty also remains over how long the conflict could continue.
US President Donald Trump said on Wednesday that he expects the Iran war to end after the November mid-term elections.
However, separate reports indicated that some senior advisers believe the conflict could continue much longer.
The possibility of a prolonged confrontation adds another layer of uncertainty for oil traders, particularly if shipping routes and energy infrastructure remain targets.
Oil Markets Remain Highly Sensitive to Geopolitical Risk
For now, crude prices remain highly sensitive to developments across the Middle East.
Any escalation involving shipping, oil tankers or energy infrastructure could increase concerns about global supply availability.
Conversely, signs of de-escalation or improved shipping conditions through the Strait of Hormuz could ease some of the risk premium currently supporting oil prices.
Until then, Brent crude is likely to remain closely tied to geopolitical developments and the outlook for Persian Gulf oil exports.
