Brent Crude Price Hikes as Tensions in Strait of Hormuz Escalate

The Brent crude oil price hit $107.46 per barrel on Tuesday, September 15th, rising by 1.68% compared to the previous day. This increase is largely due to ongoing tensions in the Strait of Hormuz, a critical shipping route for global oil supplies.

The incident involved the Panama-flagged tanker El Gaia, which was severely damaged and left without power after an explosion and fire broke out on board. Iran's Islamic Revolutionary Guard Corps (IRGC) claimed that the tanker struck a naval mine while taking an unsafe route south of the Strait of Hormuz. However, the US Central Command (CENTCOM) disputed this account, stating that El Gaia was actually hit by an Iranian drone.

The US version of events suggests that Iran had already disabled the ship with a missile strike last month and then attacked it again with a drone while it was sitting off the coast of Oman. This has raised concerns about Iran's intentions and its ability to disrupt global oil supplies.

The Strait of Hormuz remains closed to normal traffic, with only 20 US-facilitated transits taking place per day compared to the pre-conflict baseline of 138 vessel movements. The Saudi East-West pipeline, which was also damaged by drone strikes earlier this month, remains shut down with no restart date announced.