Hormuz Tensions Send WTI Crude Prices Soaring Amid Escalating Conflict
US President Donald Trump announced new military strikes on Iranian positions around the Strait of Hormuz in response to Tehran's attempts to lay mines and an earlier attack on a US military installation. The latest escalation has raised regional risks, with Iran claiming it had already attacked US bases across the wider region and fired missiles towards Jordan.
The conflict has pushed West Texas Intermediate (WTI) crude oil prices higher, with WTI trading around $89.60 in Asian hours on Thursday after rebounding from prior-session losses. Despite rising tensions, 17 million barrels of crude oil moved through the Strait of Hormuz on Monday, according to US Treasury Secretary Scott Bessent.
BNY strategists noted that this marks a significant departure from prior practice, with the US previously targeting Iranian tankers for violating naval blockades rather than attacks in the region. This shift is seen as a key factor behind the recent increase in geopolitical risk premium embedded in benchmark crude oil prices.