Oil gains as US-Iran strikes renew Hormuz supply fears
Brent reached US$89.18 and WTI US$84.32 after Washington hit two Iranian launchers and Tehran reported attacks on US bases in Jordan
- Oil prices, including Brent and WTI crude, rose by over 1% due to escalating military conflict between the United States and Iran.
- The price surge was triggered by U.S. forces striking an Iranian island in the Strait of Hormuz, followed by retaliatory Iranian attacks on U.S. bases.
- These events have renewed fears of a major supply disruption through the Strait of Hormuz, a critical chokepoint that handles about one-fifth of global oil flows.
- The conflict has already thinned vessel traffic through the strait, with operators wary of attacks on tankers in the key waterway.
Oil prices rose by more than 1% on Monday (August 31, 2026) after US forces struck an Iranian island in the Strait of Hormuz and Tehran reported retaliatory attacks on US bases in Jordan.
Brent crude futures climbed US$1.08, or 1.23%, to US$89.18 a barrel by 12.40am GMT. US West Texas Intermediate (WTI) rose 92 cents, or 1.10%, to US$84.32.
US forces struck two launchers on Iran’s Larak Island on Sunday, the first known American attack on Iran since late July. Iranian media reported on Monday, citing the Islamic Revolutionary Guard Corps, that Iran had responded by attacking two US air bases in Jordan.
The renewed exchange came as the Middle East conflict entered its sixth month.
Market weighs further escalation
IG market analyst Tony Sycamore said the latest attacks appeared to mark another escalation, although its duration was impossible to predict: “Could be days, could be weeks.”
Technical charts indicated that a WTI break above resistance at US$85.80–US$85.90 could open the way to the previous week’s high of US$87.69 and then July’s US$93.50 peak, he said.
Despite Monday’s rise, Brent and WTI were heading for modest losses in August. Both benchmarks fell by more than 4% during the previous week, their first weekly decline in three weeks.
Hormuz traffic remains thin
Negotiations to end the fighting remain deadlocked as mediators try to reopen the Strait of Hormuz, which handled about one-fifth of global oil flows before the conflict began at the end of February.
Visible commodity-vessel traffic through the strait fell to five ships a day over the weekend as operators remained wary of attacks.
The United Kingdom Maritime Trade Operations said on Sunday that a tanker had been struck by a projectile while entering the strait on Saturday.
ANZ analysts said rising oil flows through Hormuz had nevertheless kept fears of a major supply disruption in check, even though a diplomatic route towards fully reopening the waterway remained elusive.
Venezuelan oil earmarked for US reserve
US President Donald Trump said oil from Washington’s new agreement with Venezuela would be used to replenish the Strategic Petroleum Reserve, which has fallen close to its lowest level in 44 years.
No timetable has been established for when Venezuelan oil could begin making a substantial contribution to the reserve.
