On Thursday, Brent crude futures rose by 2% to $95.99 per barrel, while U.S. West Texas Intermediate crude futures increased by approximately 1.7% to $88.27 per barrel.
The surge in oil prices is attributed to President Trump's warning that any Iranian attacks on ships in the Strait of Hormuz would lead to U.S. military strikes on Iranian infrastructure, specifically mentioning bridges and power plants. Iran has responded with threats of retaliation against U.S.-linked assets in the region, indicating a potential for further conflict.
This situation follows a breakdown of a ceasefire between the U.S. and Iran, which had previously allowed for more stable shipping flows. HSBC analysts noted that the recent increase in oil prices reflects growing concerns over the security of maritime routes in the region, emphasizing that the future of oil supply stability hinges on diplomatic efforts to resolve these tensions.
The ongoing conflict has already led to Iranian attacks on vessels, prompting U.S. retaliatory actions, which complicates the situation further. The market is now closely monitoring developments, as the resolution of these issues will significantly impact oil supply and prices