Brent crude prices climbed above $100 a barrel on Wednesday as the conflict between the United States and Iran intensified, raising fresh concerns about oil supplies through the Strait of Hormuz.
The front-month Brent contract, the global benchmark for oil prices, moved above $100 a barrel during morning trading. US West Texas Intermediate crude was around $95 a barrel. Oil prices have risen almost 20% since the middle of last week as military activity in and around the strategic waterway increased.
The latest move marked the first time Brent had reached the $100 level since July 23.
US Central Command said American forces destroyed five Iranian oil tankers carrying crude on September 8. The action followed two ballistic missile attacks by Iran’s Revolutionary Guard against a US Navy warship within two days. The American command said the unidentified vessel was not hit and continued operating in regional waters.
Iran had also launched missile attacks on September 5 against a US aircraft carrier and a destroyer. Both vessels avoided the attacks, after which US forces disabled or destroyed three Iranian tankers.
Tehran later retaliated by firing missiles at a US military base in Jordan. Air defence systems intercepted most of the missiles. Iranian officials also renewed warnings against tankers operating in Kuwaiti and Bahraini waters.
Iran has repeatedly warned ships against using routes through the Strait of Hormuz without authorisation. Mohsen Rezaei, secretary of Iran’s Supreme National Security Council, said Tehran would soon establish an exclusion zone outside the strait and place unauthorised vessels on a sanctions list.
Saudi Arabia has also been affected by the conflict. Facilities operated by Aramco in Jazan were attacked again on Monday, although damage was reported to be limited.
Around 7 million barrels of oil are currently moving through the Strait of Hormuz each day, compared with roughly 20 million barrels before the conflict began on February 28.
The military confrontation has also been accompanied by growing economic pressure. Washington launched Operation Economic Outcast in late August, targeting Iran’s access to financial networks, digital assets, technology, gold, aviation and shipping.
US Secretary of War Pete Hegseth warned that American forces would destroy Iranian oil tankers if Iran attacked US vessels, while Iranian parliament speaker Mohammad Bagher Ghalibaf warned that attacks on Iranian assets would trigger retaliation.
Oil analysts are raising their forecasts as uncertainty grows. Goldman Sachs increased its December Brent forecast by $5 to $85 a barrel and its WTI forecast to $80. The bank warned that Brent could exceed $120 next year if Gulf production remains significantly below pre-conflict levels, although that is not its central forecast.
