Middle East Tensions Send Oil Prices Higher Amid Strait of Hormuz Closure

Oil prices increased on Monday as tensions in the Middle East continued to rise. The Strait of Hormuz, a critical chokepoint for global oil and gas flows, remained closed due to ongoing hostilities between the US and Iran.

The closure resulted in only five commodity vessels passing through the strait on Saturday and none on Sunday, compared to 31 transits during the preceding weekend. The situation has raised concerns over regional supply disruptions and complicated prospects for a US-Iran deal.

Brent futures rose 0.5% to $89.00 a barrel, while U.S. West Texas Intermediate crude increased by 0.4% to $82.70. Analysts at ING noted that attacks on vessels in the strait have complicated regional supply chains and reduced global oil demand forecasts from major industry bodies.