Brent Crude Surges Amid Escalating US-Iran Conflict and Strait of Hormuz Risks

Oil prices have risen for the third consecutive week due to escalating US-Iran conflict and growing risks to oil flows through the Strait of Hormuz. The international benchmark Brent crude rose about 11% this week, reaching $97.81 per barrel at one point, up from last Friday's close of $88.10. This marks a significant increase in oil prices, with Brent climbing above $90 per barrel for the first time since mid-June.

The rally began on Monday after renewed US airstrikes on Iranian targets and Tehran's retaliatory actions heightened worries over the security of the Strait of Hormuz, through which around one-fifth of global oil trade passes. Despite brief pullbacks due to US-Canada trade tensions and expectations of tighter US monetary policy, the upward momentum continued throughout the week.

Iran's threat to target energy infrastructure across the Middle East if US strikes persisted further intensified supply disruption fears, outweighing bearish US inventory data showing an unexpected rise in crude stocks. The risk of disruptions to Middle Eastern oil exports remained the dominant market driver throughout the week, putting Brent on track for a third consecutive weekly gain.