Oil prices climbed sharply on Thursday after Iran announced it had closed the Strait of Hormuz, a vital route for global energy supplies, following fresh US strikes on Iranian targets and renewed threats from US President Donald Trump.
Brent crude futures rose $1.48, or 1.59 percent, to $94.58 a barrel in early trading. US West Texas Intermediate crude gained $1.71, or 1.90 percent, to $91.74 a barrel. Earlier in the session, US crude prices had surged by more than $3.
The latest jump in prices came after Iran’s top joint military command declared that the Strait of Hormuz had been shut to oil tankers and commercial vessels. Iranian authorities warned that any ship attempting to pass through the waterway would face military action.
The Strait of Hormuz is one of the world’s most important energy routes, carrying around one fifth of global oil and gas shipments. Any disruption in the area often raises concerns over supply shortages and higher fuel costs worldwide.
Analysts at ING said the latest developments suggest that a diplomatic breakthrough remains distant and that energy flows from the Persian Gulf are likely to stay under pressure. The renewed fighting has added another layer of uncertainty to already strained oil markets.
Meanwhile, the US military said commercial shipping continued to move through the strait and reported that no American warships had been hit in the area. The statement came after Iranian state media claimed that US vessels near the waterway had been targeted by missiles and drones.
The conflict escalated further after US forces launched additional strikes against multiple locations in Iran. President Trump later warned that more attacks could follow if Tehran failed to reach an agreement with Washington.
Supply concerns were also fuelled by a sharp decline in US crude stockpiles. According to the US Energy Information Administration, crude inventories fell by 7.2 million barrels in the week ended June 5, far exceeding analysts’ expectations of a 4 million-barrel draw.
Adding to market anxiety, a Reuters survey found that OPEC production in May dropped to its lowest level in more than two decades, tightening global supplies at a time when geopolitical tensions continue to unsettle energy markets.
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