Oil jumped more than 2% on Monday after U.S. forces struck Iran's Larak Island and Iran retaliated against U.S.-linked bases in Jordan, reviving fears of a Strait of Hormuz supply disruption. Adnoc has restored its Ruwais refinery to full capacity, and a Venezuela supply deal could potentially ease the pressure.
Brent crude rose $2.37, or 2.69%, to $90.47 a barrel at 10:54 a.m. EDT Monday, after touching $91.52 earlier in the session — its highest level since August 25. U.S. West Texas Intermediate crude gained $2, or 2.4%, to $85.40.
Larak Island strike breaks a 31-day pause
U.S. forces struck two IRGC rocket launchers on Iran's Larak Island in the Strait of Hormuz on Sunday, the first acknowledged American strike on Iranian soil since late July and the end of a 31-day pause in operations. The strike killed three Islamic Revolutionary Guard Corps personnel, up from an initial count of two reported by Iranian state media. U.S. military planners acted on intelligence that the IRGC was preparing to load sea mines onto rockets to fire into Strait of Hormuz shipping lanes, according to Crypto Briefing.
In response, Iran attacked two U.S. air bases in Jordan on Monday, Iranian media reported, citing the Revolutionary Guards. Iran's missile and drone strikes were largely intercepted, with no significant damage or casualties reported among U.S. forces, though Tehran issued warnings of further action.
Traders weigh unverified claims against a stalled deal
President Trump said Sunday that Iran's Kharg Island oil hub was, according to Reuters: "blown to smithereens," but there was no evidence the island had been attacked, and Iran denied any strike, saying oil operations continued. Mediators are still seeking a deal to reopen the Strait of Hormuz, through which a fifth of global oil supplies moved before the war began at the end of February, but progress has stalled. Shipping data showed the number of visible commodity vessels transiting the strait over the weekend fell to five a day.
Despite Monday's rally, Brent and WTI remained on track for modest losses in August after falling more than 4% last week, their first weekly decline in three weeks.
Refinery restart and Venezuela deal offer supply relief
Abu Dhabi National Oil Co. has restored its Ruwais refinery to full capacity, with fuel exports recovering to about 70% of prewar levels, according to people familiar with the matter. The 922,000-barrel-a-day facility was halted in March after an Iranian drone strike sparked a fire, and had already been running at reduced rates because of restricted Hormuz shipping.
Separately, Trump said oil secured under a deal with Venezuela would replenish the U.S. Strategic Petroleum Reserve, which has fallen to near its lowest level in 44 years. Chevron, GE Vernova, India's ONGC, Italy's Eni and Colombia's GeoPark are on track to sign final agreements in Venezuela after months of negotiations, according to four people close to the preparations.
Sources: Commodities & Futures News, Crypto Briefing, Crypto Briefing
Trading involves risk.
Risk Disclaimer
