Oil Prices Rise Following US Strike on Iran’s Qeshm Island, Renewing Supply Concerns
Oil prices rose in early Asian trading on Tuesday, driven by renewed concerns over military conflict in the Middle East. Brent crude futures increased by 48 cents, or 0.5%, reaching $105.25 a barrel, while US West Texas Intermediate (WTI) crude gained 47 cents, also up 0.5%, to $96.93. This uptick follows a significant drop on Monday, when Brent fell 7.63%, or $8.66, settling at $104.77 a barrel.
Reports of a US strike on Iran’s Qeshm Island have heightened fears of further escalation in the region. According to The Wall Street Journal, US officials characterized the strikes as defensive measures aimed at preventing Iran from targeting commercial vessels in the Strait of Hormuz. This waterway is crucial for global energy supplies, accounting for about 20% of the world’s crude oil and natural gas transport before the onset of the conflict in late February. The ongoing reduction in shipping traffic has kept supply risks elevated.
Despite the military tensions, both the US and Iran have indicated a willingness to continue diplomatic discussions. Iran confirmed ongoing contacts with Washington after talks mediated by Qatar ended without a breakthrough, although new proposals were presented. US President Donald Trump expressed uncertainty about resuming military strikes but acknowledged the potential for an agreement with Tehran. Iranian President Masoud Pezeshkian stated that Supreme Leader Ayatollah Mojtaba Khamenei had empowered the government to pursue peace talks.
