Hormuz Tensions Push Oil Prices to $89.40 a Barrel
Oil prices rose on Monday due to the breakdown in US-Iran diplomacy and a sharp slowdown in tanker traffic through the Strait of Hormuz, restoring a geopolitical premium across crude markets.
Brent climbed as much as 1% to $89.40 a barrel, while West Texas Intermediate rose to $82.83.
The immediate driver remains the Strait of Hormuz, where shipping activity has slowed sharply as Washington and Tehran remain deadlocked over reopening the route. Only five commodity vessels crossed the strait on Saturday and none were recorded on Sunday, compared with 31 the previous weekend.
Iran's Foreign Minister Abbas Araqchi has said Tehran has not decided to resume negotiations with the US, while the UAE has accused Iran of targeting another ADNOC-operated tanker. Fresh violence in Lebanon has added to the regional risk, as Israeli strikes in southern Lebanon killed at least 11 people over the weekend.
The market response, however, remains measured rather than disorderly. AMP chief economist Shane Oliver expects crude to stay broadly within a $70-$100 range while the Hormuz impasse persists, with constrained Middle East exports putting a floor under prices but weaker demand limiting the upside.