Oil price surge to $105 per barrel amid escalating Iran-US tensions over Strait of Hormuz

Oil prices climbed sharply to over $105 per barrel on Thursday, reversing earlier losses as renewed tensions between Iran and the United States disrupted stability around the strategic Strait of Hormuz. The waterway is a critical global shipping route through which about 20% of the world’s oil and gas supply passes.

The latest surge follows the collapse of a ceasefire understanding between both countries, which had earlier pushed prices down from $115 to $88 per barrel. Market sentiment shifted again after reports that Iran allegedly closed the shipping route, citing US-imposed restrictions on its maritime trade activities.

Tensions escalated further after the United States introduced a blockade restricting Iran’s sea-based trade, including vessels suspected of supporting military activity. Washington has maintained that the measures are aimed at limiting Iran’s access to goods that could support its ongoing conflict with Israel and US interests in the region.

US President Donald Trump further intensified the situation by directing the military to take action against small Iranian vessels suspected of laying mines in the Strait of Hormuz. He also confirmed that US naval forces were actively clearing the route, while warning that enforcement would be increased significantly.

Diplomatic efforts remain uncertain, with mediators reportedly struggling to bring both sides back to negotiations. Iran insists talks cannot resume unless the blockade is lifted, while the United States maintains that access to the Strait must be fully restored before any diplomatic engagement can continue.

source: punch