U.S.-Iran Tanker War Escalates Oil Prices Above $100

Crude oil prices continue to hold near recent highs, driven by escalating tensions in the U.S.-Iran conflict. The crisis has led to a series of attacks on tankers and warships in the Persian Gulf, with Iran reporting hits on U.S. vessels. In response, the United States said it had hit ten Iranian tankers.

Iran's actions have prompted warnings from analysts that oil flows in the region may be disrupted for an extended period. 'The tit-for-tat attacks suggest oil flows from the Persian Gulf are likely to remain disrupted for the foreseeable future,' ANZ analyst Daniel Hynes said. The risk of meaningful disruptions to Strait of Hormuz flows has also been highlighted, with ING commodity analysts warning that the market could tighten sharply if ongoing escalation translates into disrupted oil flows.

President Trump's comments on the conflict have added fuel to the fire, with him accusing Iran of trying to influence the U.S. midterm elections in November. However, some of his closest advisers have warned that the war could extend for years, up to the end of Trump's presidential term in 2029.

At the time of writing, Brent crude was trading at $101.04 per barrel and West Texas Intermediate at $96.09 per barrel.