Brent crude oil prices climbed above $90 per barrel on Monday as renewed tensions between Iran and the United States raised fresh concerns over the safety of oil shipments through the strategically important Strait of Hormuz. Brent rose by $2.01, or 2.27 per cent, to $90.53 per barrel, while US West Texas Intermediate crude gained $1.85, or 2.25 per cent, to $84.25 per barrel, according to oil market data.
The latest price jump followed a warning from an Iranian official that Tehran could move from a defensive position to a more offensive military posture if diplomatic efforts to end the conflict fail. The official told Reuters that Iran was prepared to take action in the Strait of Hormuz if negotiations broke down, raising fears that further military escalation could disrupt the movement of oil tankers through the vital waterway.
The Strait of Hormuz remains one of the world’s most important energy routes, with a significant share of global oil and liquefied natural gas supplies passing through it. Any prolonged disruption could place additional pressure on global energy markets, potentially pushing crude prices even higher and increasing fuel costs in countries that depend heavily on imported petroleum products.
Efforts to restore oil traffic through the strait have reportedly stalled amid disagreements between Washington and Tehran over the terms of a June memorandum. The agreement was intended to create a pathway towards a broader settlement involving Iran’s nuclear programme, US sanctions and the cessation of military operations. However, disagreements over control and management of the waterway have contributed to renewed tensions.
The latest escalation has added uncertainty to an oil market that had recently seen prices fall below $80 per barrel on expectations that tensions around the waterway would ease. With diplomatic efforts now facing fresh obstacles and threats of military action increasing, traders are closely watching developments around the Strait of Hormuz. A sustained disruption to shipping could keep Brent crude oil prices elevated and create wider consequences for global energy markets in the days ahead.
source: punch
