Iran's Hormuz Threat Keeps Oil Prices High Amid Escalating Middle East Tensions

Tensions in the Middle East continue to escalate as Iran and the US engage in a war of words over the Strait of Hormuz. The waterway, which handles a fifth of global oil and liquefied natural gas flow, remains closed after Iran's top security official, Mohsen Rezaei, stated that it will remain shut until the US accepts Tehran's conditions to end the conflict.

Rezaei's comments came in response to President Donald Trump's demand on Monday that Iran pay compensation for people killed in 50 years of wars, attacks, and protests. The Iranian official also called for the release of Iran's frozen assets and an end to conflicts throughout the region.

The US has stepped up its rhetoric as well, with Trump suggesting that he might 'bop along' and let Tehran fail economically or hit them 'really, really hard.' Meanwhile, a suspected Houthi attack on a Saudi ship in the Bab el-Mandeb Strait resulted in no casualties, but highlights the ongoing threat to global shipping.

Oil prices gained 1.4% to settle at $88.91 per barrel as prospects for ending the conflict dimmed. The US military also reported that a U.S. Navy MH-60 helicopter fired two Hellfire missiles to disable the steering gear of a Panama-flagged cargo ship that ignored repeated warnings to stop violating a naval blockade on Iranian ports.