LONDON: Oil prices extended their upward movement on Monday as fresh US and Iranian strikes on vessels heightened concerns that military tensions could further disrupt crude supplies from the Middle East.
Brent crude futures rose 52 cents, or 0.54%, to $96.80 a barrel by 2354 GMT, while US West Texas Intermediate (WTI) increased 66 cents, or 0.72%, to $92.14 a barrel.
The latest gains followed a sharp rally last week, when Brent jumped 7.8% and WTI advanced nearly 10% as renewed hostilities between Washington and Tehran disrupted shipping through the Strait of Hormuz.
The strategic waterway has historically handled around a fifth of global oil supplies, making any prolonged disruption a major concern for international energy markets.
Tankers caught in escalating conflict
The US Central Command said American forces struck three Iranian oil tankers on Saturday, including a vessel located off Kharg Island, a major Iranian oil export centre.
Iran’s Islamic Revolutionary Guard Corps Navy said it had targeted three oil tankers using unauthorised routes through the Strait of Hormuz, along with three additional US vessels operating elsewhere.
Maritime intelligence firm Marisks described the attacks as a major escalation in the maritime confrontation.
The company warned that commercial tankers were increasingly becoming targets in the economic confrontation, blurring the traditional distinction between military operations and commercial shipping.
Hormuz traffic falls sharply
Shipping through the Strait of Hormuz has declined significantly amid the escalating tensions.
According to data from analytics firm Kpler, an average of only 10 commodity-carrying vessels crossed the waterway each day over the past 10 days, marking the lowest level since May.
Iranian Supreme National Security Council Secretary Mohsen Rezaei also said on Sunday that authorities would announce a restricted zone outside the Strait of Hormuz in the coming days, according to state media.
OPEC+ keeps October policy unchanged
Meanwhile, OPEC+ decided to maintain its existing oil production policy for October following a meeting on Sunday.
The producer alliance said it still needed to agree on new production quotas before determining its next steps on output.
Market analysts warned that continued military tensions could prevent Middle Eastern oil supplies from returning quickly to normal levels.
ANZ analysts said a prolonged standoff involving calibrated military action by the US and Iran appeared to be the most likely scenario.
They forecast that regional oil exports could remain restricted through the remainder of 2026, with a gradual reopening expected toward the end of the fourth quarter.
A full recovery to pre-conflict production and export levels, however, was not expected until late in the first quarter or early in the second quarter of 2027, the analysts said.
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