US-Iran Tensions Fuel Oil Price Surge

Oil prices surged on Wednesday due to escalating tensions between the US and Iran, coupled with concerns over energy supply disruptions. The uptick in prices follows a brief decline in Brent crude on Tuesday, which fell below $85 per barrel for the first time since July 20.

Brent crude climbed $3.15, or 3.8%, to $87.24 per barrel by 11:20 am Bangladesh time, while West Texas Intermediate (WTI) crude gained $2.73, or 3.4%, to $81.99 per barrel.

Market analysts attributed the price increase to renewed geopolitical uncertainty, which has weakened hopes for a near-term easing of tensions in the Middle East. The attempted attack on US forces and joint strikes against Iran-backed armed groups in Iraq contributed to concerns over regional stability and global oil supplies.

The Strait of Hormuz, one of the world's most important energy shipping routes, remains a key point of contention between the two nations. Iran has rejected Oman's proposal for a joint management framework for the waterway, which carries roughly one-fifth of global crude oil and liquefied natural gas shipments.

Analysts expect continued price volatility as geopolitical risks remain elevated, with DBS Bank's head of energy research, Suvro Sarkar, predicting that Brent crude will trade between $80 and $100 per barrel in the near term if instability persists.