Hormuz Tensions Send Oil Prices Soaring as Global Supplies Hang in Balance

Global oil prices surged on Friday as tensions in the Strait of Hormuz escalated, casting a shadow over the prospects for full reopening of one of the world's most critical oil transit routes.

The US West Texas Intermediate (WTI) crude traded above $78 per barrel, while Brent crude rose beyond $83 per barrel, following reports that Iran had attacked what it described as 'hostile targets' in the Strait of Hormuz after explosions were reported near Qeshm Island.

Markets are assessing the implications of a proposed Iran-Oman agreement governing navigation through the Strait of Hormuz. Under the draft proposal, Iran is seeking to prohibit US and Israeli vessels from transiting the waterway and require countries it considers hostile to pay compensation before passage is permitted.