Oil prices rise as Iran tensions hit supply
- Oil prices increased more than $1 per barrel on Monday as U.S.-Iran strikes on vessels raised concerns about longer supply disruptions in the Middle East.
- Brent crude rose 1.25% to $97.48 per barrel, while U.S. West Texas Intermediate crude gained 1.25% to $92.62 per barrel.
- Analysts said continued disruption around the Strait of Hormuz could restrict oil exports, with recovery potentially delayed into 2027.
Brent crude futures and U.S. West Texas Intermediate crude prices rose more than $1 per barrel on Monday as renewed U.S.-Iran strikes involving vessels increased concerns about potential oil supply disruptions in the Middle East.
Brent crude futures increased $1.20, or 1.25%, to $97.48 per barrel by 0727 GMT, while WTI crude gained $1.14, or 1.25%, to $92.62 per barrel after both benchmarks posted weekly gains of 7.8% and nearly 10% respectively.
"Commercial tankers are now being deliberately used as instruments of reciprocal economic pressure, substantially weakening the previous distinction between military confrontation and commercial shipping," said maritime intelligence firm Marisks.
The latest vessel attacks involved U.S. strikes on three Iranian oil tankers, including one near Kharg Island, while Iran’s Islamic Revolutionary Guard Corps said it targeted three oil tankers and three additional U.S. vessels, according to reports.
Following the developments, the average number of commodity ships passing through the Strait of Hormuz fell to 10 per day over the previous 10 days, the lowest level since May, according to analytics firm Kpler.
The Strait of Hormuz remains a key oil transit route, with analysts warning that further restrictions could increase pressure on global crude supplies if tanker traffic declines further.
OPEC+ maintained its oil output policy for October after its latest meeting, while ANZ analysts said they expect exports to remain constrained through the end of 2026 before a gradual reopening process begins in the fourth quarter of 2026.
