Oil prices climbed to a nearly one-month high after President Donald Trump threatened new economic sanctions against Iran, as the two countries remained deadlocked over the Strait of Hormuz. The U.S. also eased summer gasoline rules to blunt rising pump prices at home.
Trump threatens 'economic D-Day' against Iran
Brent crude futures rose 1.8% to settle at $93.25 a barrel, while WTI crude added 2.2% to settle at $86.21 a barrel on Thursday.
The move came after Trump said Washington would impose stricter economic restrictions on Iran, and markets braced for a longer standoff over the Strait of Hormuz. Trump did not detail the new sanctions but warned that entities doing business with Iran would also face penalties.
According to a social media post cited by Investing.com: "This will be Economic Warfare and Isolation on an unprecedented scale". Analysts at ING read the warning as a signal of further escalation in U.S. efforts to isolate Iran.
Hormuz standoff drags on
Tehran had already responded to U.S. pressure by effectively blocking the Strait of Hormuz, disrupting around 20% of the world's oil and liquefied natural gas supplies. Shipping data cited in the report showed commercial traffic through the strait has slowed to a fraction of pre-war levels, despite U.S. officials repeatedly saying the waterway remains open.
Iran has largely denied that talks with Washington are underway. Tehran wants the U.S. to fulfil a framework peace deal signed in June before any progress on unblocking the strait, but that memorandum of understanding lapsed earlier this week with little sign of renewal.
Washington eases gasoline rules at home
Away from the Middle East, the U.S. Environmental Protection Agency, working with the Department of Energy, issued a temporary emergency fuel waiver to ease pump prices. Starting September 1, 2026, the waiver allows the sale of E10 gasoline at a higher Reid Vapor Pressure, effectively ending the summer-blend requirement early and adding hundreds of thousands of barrels a day to domestic supply.
Energy Secretary Chris Wright called it part of the administration's effort to cut red tape and lower fuel costs. The national average for gasoline stood at $4.1044 a gallon on Thursday, according to AAA figures cited in the report.
Source: Commodities & Futures News
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