Oil Market Sees Red as US-Iran Tensions Escalate

The oil market is on high alert as tensions between the US and Iran escalate in the Middle East. US President Donald Trump warned that Iran would 'rot economically' if it didn't make a deal quickly, prompting a stern response from Iranian military officials.

Any fresh attack on Iran will trigger retaliation against US bases in the region, with allies considered parties to the conflict, according to Reuters. The war has been stuck in a stalemate for months, with neither side showing any willingness to compromise.

The US Central Command (CENTCOM) has taken measures to secure commercial vessels, redirecting 109 ships and disabling more than three others to prevent them from entering or departing Iranian ports. So far, CENTCOM claims to have supported over 1 billion barrels of crude oil leaving the Gulf through the Strait of Hormuz in recent months.

However, the situation remains volatile, with fresh attacks on commercial vessels reported within the Strait of Hormuz. The UKMTO agency reported that a tanker was hit by an unknown projectile causing a fire onboard, while Windward reported that only six vessels attempted to transit the Strait of Hormuz last Friday, severely choking vessel traffic.