Iran-US Hostilities Send Oil Prices Soaring to One-Week High

Oil prices surged by about 4% to a one-week high on Tuesday as renewed hostilities between the US and Iran stoked fears of supply disruptions from the Middle East. The Brent futures rose $3.44, or 3.8%, to $93.93 a barrel at 1:10 p.m. EDT (1710 GMT), while U.S. West Texas Intermediate crude rose $3.72, or 4.3%, to $89.48.

The recent exchange of fire between the two countries has raised concerns about prolonged disruptions to energy flows through the Strait of Hormuz. Tehran remained defiant, warning that it would prevent oil being exported from the Gulf, despite a threat by US President Donald Trump to hit Iran 'hard' in response to the renewed Iranian strikes.

The fresh hostilities have also caused diesel prices to spike, with disruptions at refineries around the world contributing to the increase. In the US, diesel futures were trading around a 52-month high on Tuesday after soaring about 51% over the past 10 weeks, boosting the diesel crack spread, which measures refining profit margins, to a record high near $106 a barrel.