Hormuz Uncertainty Drives Oil Prices Higher Despite US-Iran Tensions

Oil prices are on track for a weekly gain despite uncertainty surrounding supply through the Strait of Hormuz, a key waterway in the Middle East. The global oil benchmark, Brent crude futures, was down 0.2% to $86.84 a barrel at 09:30 ET (13:30 GMT), while U.S. West Texas Intermediate crude futures had dipped 0.4% to $80.91 a barrel. However, both benchmarks were still up around 5% this week.

The closure of the Strait of Hormuz has been a significant factor in supporting oil prices this year, as it carries about one-fifth of the world's oil and liquefied natural gas. A tanker was struck by an uncrewed aerial vehicle while attempting to exit the waterway on Friday, but the UK Maritime Trade Operations agency reported that the vessel sustained minor damage and its crew were safe.

The incident came as the U.S. and Iran remain at odds over control of the strait. Iran has claimed it still controls the waterway, despite the U.S. saying it continues to facilitate sailings. The U.S. Defense Secretary Pete Hegseth said Washington could maintain its naval blockade of Iranian ports indefinitely.

The continued presence of American naval forces in the Gulf has reportedly caused significant economic damage to Iran. President Donald Trump suggested that economic sanctions would eventually force Tehran to accept U.S. demands, including an end to its nuclear program and a full reopening of the Strait of Hormuz.