Crude Prices Soar on Escalating US-Iran Tensions

The price of crude oil surged on August 17 as tensions between the US and Iran escalated. The expiration of a memorandum of understanding (MOU) aimed at ending hostilities between the two nations brought Middle East geopolitical risk back into focus.

WTI futures for October delivery on the New York Mercantile Exchange settled regular trading at $83.65 per barrel, up $2.13 or 2.61% from the previous session. Brent crude in London rose $2.35, or approximately 2.7%, to $90.87.

The US Treasury Secretary's stated policy of tightening sanctions on Iran and maintaining a naval blockade amplified supply concerns. Reports that Yemen's Iran-backed Houthi rebels had targeted Saudi Arabia's Jizan refinery heightened anxiety over Middle East supply networks.