Iran Strait Ban Threatens Global Oil Supplies Amid Rising Tensions

Oil prices surged on Thursday after an Iranian parliament committee began reviewing a bill that would ban US and Israeli vessels from the Strait of Hormuz, a crucial global oil shipping route. The proposed restrictions would also fine violators up to 20% of their cargo value.

Brent crude futures rose by $3.04 or 3.83% to settle at $82.49 per barrel, while US West Texas Intermediate futures increased by $2.07 or 2.75% to $77.29.

Iranian lawmakers are reviewing the preliminary bill in response to tensions with the US and its allies. The country has warned Gulf states that any new US attack on its territory would trigger attacks on critical energy infrastructure across the region.

The Strait of Hormuz, which connects the Persian Gulf to the Gulf of Oman, is a vital shipping route for global oil supplies. About one-fifth of daily crude and liquefied natural gas flows through the strait.

Other factors are also contributing to the rise in oil prices, including ongoing tensions between Iran and Saudi Arabia, as well as concerns over potential disruptions to global energy supplies.