Oil Prices Soar Amid Escalating Tensions with Iran

Crude oil futures settled at $87.83 per barrel on Wednesday, marking one of the sharpest single-day gains in recent weeks.

The rally was fueled by fading hopes for a diplomatic resolution between the United States and Iran, alongside continued disruption risk tied to the Strait of Hormuz.

Traders have priced in escalating geopolitical risk, which has kept oil prices volatile throughout the session.

A weaker U.S. dollar also contributed to the day's gains, as a softer greenback effectively lowers the cost of oil for buyers holding other currencies.

The current tightness in commercial crude inventories in the United States has made crude prices more sensitive to headline risk.