The Strait of Hormuz sees oil prices surge amid new attacks
Oil prices rose again after clashes between the United States and Iran intensified around the Strait of Hormuz . Tensions escalated over the weekend, raising fears of potential disruptions to one of the world's most important shipping routes for crude oil.
Furthermore, traders began to factor in a higher risk premium due to threats to oil tankers, ports, and coastal facilities. Although physical supply remains orderly for now, the energy market remains vulnerable to rapid changes should shipping face new restrictions.
The Strait of Hormuz is the focus of market attention
First, the Strait of Hormuz has become the epicenter of the tension due to its importance in Persian Gulf oil and gas exports. Any prolonged blockade could reduce shipping traffic and disrupt flows to Asia, Europe, and other markets.
Iran, for its part, stated that the maritime passage would remain closed until further notice. The United States rejected this claim, maintaining that its forces are prepared to uphold freedom of commercial navigation.
Meanwhile, U.S. Central Command reported that it conducted a new series of strikes against Iranian targets on July 12. The operations targeted air defense systems, coastal radar stations, missile and drone capabilities, and small vessels.
The United States and Iran expand their military operations
Iran subsequently responded with drone and missile attacks against US-linked positions in the Middle East, including Bahrain, Kuwait, and Qatar.
Meanwhile, the Speaker of the Iranian Parliament, Mohammad Bagher Ghalibaf, conditioned the reopening of the Strait of Hormuz on new agreements regarding transit and exports. Tehran has also warned of possible actions on other energy routes in the region.
According to teleSUR, the Iranian Revolutionary Guard raised the possibility of extending restrictions to corridors used for transporting oil and gas. These include Bab el-Mandeb, which connects the Red Sea to the Gulf of Aden.
The price of oil reflects geopolitical risk
crude oil benchmarks maintained an upward trend. Brent crude for September delivery rose to $86.15 per barrel, while West Texas Intermediate settled at $80.34, according to data published by Xspectro.
Both indexes also accumulated several sessions of gains, reaching levels not seen in the last month. This movement reflects fears that the confrontation could limit shipping or affect production-related facilities.
However, Saxo Bank noted that the moderate spread between short-term and long-term contracts indicates that the physical crude oil market is still functioning in an orderly manner. This situation could change if attacks target tankers, terminals, or loading areas.
Refined fuels increase pressure
On the other hand, the concern is not limited to crude oil; refined products are experiencing tighter conditions due to supply restrictions and the Russian ban on diesel exports mentioned by Saxo Bank.
Consequently, further disruptions can be passed on to transport prices, industrial production, and consumer goods. Increased diesel prices typically have a broad impact because this fuel is used in trucks, ships, and machinery.
Furthermore, the International Energy Agency warned that hostilities could hinder the rebuilding of reserves. A slow recovery of inventories would reduce the market's ability to respond to further supply losses.
Diplomacy can reduce part of the risk premium
In the short term, the evolution of oil prices will depend on actual traffic through the Strait of Hormuz. If ships continue to pass through and no significant damage occurs to ports or energy facilities, some of the increase may be mitigated.
Conversely, a noticeable drop in maritime flows could trigger further increases in Brent and WTI prices. Traders will be monitoring tanker movements, military decisions by Washington and Tehran, and any signs of negotiations.
Finally, analysts believe that credible talks could quickly remove some of the premium already factored into the price. However, the continued attacks currently reduce the chances of an immediate diplomatic solution.
As long as the confrontation persists, the Strait of Hormuz will continue to dictate the course of the energy market . Its situation will influence crude oil, refined fuels, and inflation expectations in various economies.
News of additional interest
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