Oil prices extended gains on Tuesday after a tanker was struck by three unidentified projectiles in the Strait of Hormuz and President Donald Trump vowed to hit Iran "hard" following the first direct U.S.-Iran strikes in a month. Brent crude traded above $90 a barrel as traders weighed renewed risk to Gulf shipping and energy infrastructure.
Tanker attack reignites Hormuz risk
A tanker was struck by three unknown projectiles while transiting the Strait of Hormuz on Monday, the UK Maritime Trade Operations agency said Tuesday, adding that no casualties were reported. The vessel was sailing in the southern shipping lane close to the Omani coast.
The UKMTO also said the tanker was reported struck by three projectiles while sailing out of the Strait of Hormuz, with no casualties or environmental impact reported. The number of visible commodity vessels transiting the strait held at five per day on Monday, below the 10-day average of around 14, according to shipping data from Kpler.
Trump vows to hit Iran hard
Iran launched an attack on two American bases in Jordan on Monday in retaliation for the U.S. strike on its Larak Island, after American forces targeted two Iranian rocket launchers there on Sunday. The exchange marked the first time the U.S. and Iran traded strikes in over a month.
According to CNBC: "We are going to hit them hard", Trump told Fox News on Monday, saying there would be a response to Iran's attacks on U.S. bases in the region. Iranian President Masoud Pezeshkian told the Shanghai Cooperation Organisation Summit that Tehran would immediately reciprocate if Washington returned to its commitments under the interim deal signed in June.
Prices climb on renewed disruption fears
Brent crude futures rose 66 cents, or 0.7%, to $91.15 a barrel at 0640 GMT Tuesday. WTI crude gained 70 cents, or 0.8%, to $86.46. In the previous session, Brent closed up 2.7%, touching its highest since August 25, while WTI settled up 2.8%, its highest since August 21.
Tim Waterer, chief market analyst at KCM, said the renewed potential for Iranian retaliation raises the prospect of damage to Gulf energy infrastructure and adds fresh uncertainty for shipping through the Strait of Hormuz, both of which are being reflected in the firmer tone in crude prices. Efforts by Qatar and Oman to broker a deal reopening the strait, which carried about a fifth of global oil supplies before the war erupted in late February, have so far failed to gain traction.
Buffers wearing thin
ANZ analysts noted that satellite tracking firms suggest oil flowing through Hormuz is around 6 million barrels per day, well below pre-conflict levels, while U.S. inventories are nearing minimum levels. U.S. Strategic Petroleum Reserve stockpiles fell by about 3.1 million barrels last week to 286.6 million barrels.
Washington has also ramped up secondary sanctions targeting nations and businesses that buy crude oil from Iran. U.S. Treasury Secretary Scott Bessent said Monday that Iran was lashing out militarily because the sanctions were taking a toll on its economy. Analysts polled by Reuters in August expect oil prices to remain above $80 a barrel in 2026 as shipping disruptions continue.
Sources: CNBC, Investing.com
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