Oil prices extended their gains on Tuesday as investors assessed the risk of further disruption to Middle East energy supplies.
Brent crude remained above $97 per barrel after Iran warned that oil and gas infrastructure across the Gulf could be targeted in retaliation for attacks on Iranian assets.
Brent and WTI Oil Prices Move Higher
Brent crude futures for November delivery rose 0.5% to $97.49 per barrel by 00:12 ET.
Meanwhile, US West Texas Intermediate crude futures gained 1.6% to $92.93 per barrel.
Brent had already settled nearly 1% higher on Monday after briefly reaching $98 per barrel during the previous session.
The latest gains reflect growing concern that geopolitical tensions could threaten energy production and shipping routes across the Gulf.
US-Iran Tensions Raise Supply Risks
Oil markets remain focused on escalating tensions between the United States and Iran.
A series of retaliatory strikes took place over the weekend, including attacks involving shipping.
Iranian officials later warned that US-linked oil and gas interests, along with other energy infrastructure across the Gulf, could face retaliation.
Iranian Parliament Speaker Mohammad Baqer Qalibaf said the region’s oil and gas infrastructure was widely exposed.
He also warned that attacks on Iranian energy assets could trigger further retaliatory action.
Strait of Hormuz Remains Key for Oil Markets
The Strait of Hormuz remains one of the biggest concerns for energy traders.
The narrow waterway is a critical route for global oil and gas shipments.
Iran has announced plans to introduce a new restricted zone in the Gulf as well as an alternative shipping corridor.
These measures have raised fears that tighter maritime controls could slow tanker traffic through the area.
Any major disruption to shipping through the Strait of Hormuz could create significant pressure on global crude oil supplies.
Diplomacy Offers Some Relief
Despite the rising tensions, diplomatic efforts have helped limit some of the upward pressure on oil prices.
Iran said it was close to reaching an agreement with Oman over arrangements for the Strait of Hormuz.
Such an agreement could potentially create a framework to reduce shipping disruptions and improve maritime access.
However, investors remain cautious about whether diplomacy can quickly resolve the broader confrontation between Iran and the United States.
Oil Prices Have Already Surged
The conflict has already driven crude oil prices sharply higher.
Brent crude gained around 8% last week, while WTI climbed nearly 10%.
The rapid increase reflects fears that further attacks could disrupt production facilities, tanker routes or export infrastructure across the Gulf.
Energy traders are therefore closely monitoring both military developments and diplomatic negotiations.
Gulf Energy Infrastructure Remains in Focus
The outlook for oil prices now depends heavily on whether tensions escalate further.
Any attack on major energy facilities or additional restrictions around the Strait of Hormuz could push crude prices higher.
On the other hand, progress in diplomatic talks could ease fears of supply disruption and reduce some of the geopolitical risk premium currently built into oil prices.
For now, the market remains highly sensitive to developments involving Iran, the United States and Gulf energy infrastructure.
