Oil prices rose more than 2 percent on Monday after renewed military exchanges between the United States and Iran heightened fears of potential disruptions to global energy supplies through the Strait of Hormuz.
Brent crude futures gained $2.21, or 2.5 percent, to trade at $90.31 per barrel by 0436 GMT. US West Texas Intermediate (WTI) crude also advanced, rising $1.83, or 2.2 percent, to $85.23 per barrel.
The gains followed US strikes on two missile launchers located on Iran’s Larak Island in the Strait of Hormuz on Sunday. The operation marked Washington’s first publicly known attack on Iranian territory since late July.
Iran responded by targeting two US air bases in Jordan, according to Iranian state media, which cited the country’s Revolutionary Guards. The latest exchange has pushed the conflict into its sixth month, with little sign of a diplomatic breakthrough.
Adding to market uncertainty, US President Donald Trump claimed in a social media post that Iran’s Kharg Island energy hub was being destroyed. However, there was no independent evidence to support the claim, and the post included an AI-generated video without further details.
The Strait of Hormuz remains at the centre of investor attention. Before the conflict erupted in late February, the narrow waterway handled around one-fifth of global oil shipments. Efforts by international mediators to restore normal shipping traffic have so far failed to produce a breakthrough.
Analysts believe the conflict is unlikely to spiral into a prolonged regional war but warn that repeated flare-ups continue to delay hopes of reopening the vital shipping route.
Suvro Sarkar, head of energy research at DBS, said the market is increasingly pricing in a longer wait for any agreement between Washington and Tehran.
He said expectations that negotiations could resume before the end of the third quarter now appear less likely, adding that crude prices are likely to remain in the $85 to $95 per barrel range until there is greater clarity over the security situation in the Strait of Hormuz.
Shipping activity through the strategic passage also remains subdued. Data released on Monday showed that only five visible commodity vessels passed through the strait each day over the weekend, reflecting growing caution among shipping companies concerned about attacks.
The United Kingdom Maritime Trade Operations (UKMTO) separately reported that a tanker travelling through the Strait of Hormuz was struck by a projectile on Saturday while sailing inbound.
Meanwhile, US Treasury Secretary Scott Bessent said Washington is expected to introduce new secondary sanctions on Iran on a weekly basis, signalling continued economic pressure alongside military measures.
Despite Monday’s rebound, both Brent and WTI crude remain on course to end August slightly lower after losing more than 4 percent last week, their first weekly decline in three weeks.
Separately, Trump said oil secured under a recent agreement with Venezuela would be used to replenish the US Strategic Petroleum Reserve, which is hovering near its lowest level in more than four decades.
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