Oil prices surge again as attacks rock strait of hormuz

Oil prices jumped above $100 a barrel again today after two oil tankers were attacked in the Persian Gulf, escalating tensions in an already volatile market. The surge followed a warning from Iran that prices could reach $200.

Iran threatens further oil price hikes amid gulf conflict

Brent crude futures rose 6.6% to $98.09 per barrel, while West Texas Intermediate (WTI) crude climbed 6.4% to around $92.91, reflecting growing concerns about supply disruptions amid the rapidly evolving conflict in the Persian Gulf. The attacks, which included three cargo ships and a dry bulk carrier, have raised fears about the security of one of the world's most vital oil chokepoints.

The attacks appear to be a direct response from Iran to the International Energy Agency's (IEA) announcement yesterday to release 400 million barrels of strategic reserves – the largest coordinated release in the agency's history. “Prepare for oil prices to reach $200 a barrel, because the price of oil depends on regional security, which you have destabilized,” said Ebrahim Zolfaqari, a spokesperson for Iran’s military command, addressing Washington, according to Reuters.

Analysts are skeptical that the IEA’s move will fully offset the disruption. The Strait of Hormuz handles approximately 20% of the world's oil shipments, and alternative routes are limited.