Oil Prices Soar as Iran Threatens Export Corridors Amid Escalating Tensions

Oil prices surged by around 2% on Wednesday as tensions between Iran and the US escalated. The price hike came after President Donald Trump reimposed a naval blockade on all Iranian ports, prompting Iran's Islamic Revolutionary Guard Corps to threaten to close 'all other export corridors that benefit the U.S. and its allies'.

Gulf exports have slipped below 50% of pre-war levels over the last week, according to Goldman Sachs, which estimates Brent could exceed $110 in the fourth quarter if Gulf export recovery continues to stall.

Analysts believe Iran may use its Houthi allies in Yemen to shut the Bab el-Mandeb gateway to the Red Sea, putting two of the world's most vital energy arteries at risk. The US military began a fresh round of strikes against Iranian capabilities used to attack commercial shipping in the Strait of Hormuz.