Global oil prices reached their highest level in four weeks on Tuesday as renewed military tensions between the United States and Iran raised concerns about possible disruptions to energy supplies through the Strait of Hormuz.
Brent crude futures climbed 2.3% to $85.20 per barrel, while US West Texas Intermediate (WTI) crude increased 2.4% to $80.05 per barrel during early trading. Both oil benchmarks had already gained more than 9% in the previous session, with Brent recording its biggest single-day jump since May 2020.
The latest rise came after tensions in the region escalated further. The United States reinstated a naval blockade targeting Iranian shipping and carried out a third straight night of military strikes on Iran. President Donald Trump also proposed a 20% security fee for vessels passing through the Strait of Hormuz.
The Strait of Hormuz is one of the world’s busiest oil transit routes, carrying nearly one-fifth of global crude exports. Any disruption to shipping through the passage could have a major impact on global energy markets.
Read Also: PDMA issues two-day rain alert for most Punjab districts
Market analysts said the latest developments have added a significant risk premium to oil prices.
“The latest escalation, including the US reinstatement of the blockade and Iranian responses, has clearly increased uncertainty in the market,” said Tim Waterer, Chief Market Analyst at KCM Trade.
Concerns grew further after reports that two UAE oil tankers were hit by Iranian cruise missiles in Omani waters, leaving one Indian crew member dead and eight others injured. Shipping data also showed tanker traffic through the Strait of Hormuz dropped to its lowest level in two months.
Analysts believe oil prices could move even higher if tanker operations are disrupted or crude exports decline. However, they added that if shipments continue despite the conflict, the current geopolitical premium may begin to ease over time.
Regional tensions also increased after Yemen’s Houthi movement launched missile attacks toward Saudi Arabia following clashes with the internationally recognized Yemeni government. The development has renewed concerns about the safety of oil infrastructure in the Red Sea.
At the same time, traders are closely monitoring US oil inventory data. Expectations that crude stockpiles fell last week could provide further support to global oil prices.