$100 Oil Soars as Gulf Tensions Escalate
Oil prices have surged to levels not seen since early July after renewed fighting in the Gulf escalated concerns about inflation progress. The global benchmark Brent crude surpassed $100 a barrel on Wednesday, while West Texas Intermediate, the U.S. benchmark, jumped to $95 a barrel.
The increase came after the United States destroyed several Iranian oil tankers over the weekend in response to Tehran’s attempted attacks on American warships in the region. Energy facilities in Saudi Arabia were also attacked by Iran-allied militant groups, adding to fears about constrained supplies that could put more pressure on prices.
Several rounds of negotiation between Washington and Tehran yielded little progress in the weeks after an interim peace deal was reached earlier this summer. The collapse of talks amid threats to and attacks on tankers in the strait has led to a significant cut-off in oil and natural gas supplies through the Strait of Hormuz, where 20% of the world's natural gas and oil passed through before the war.
The U.S. has pushed for conditions for passage through the strait to return to pre-war norms, while Iran has insisted it be allowed to collect fees from ships passing through.