US-Iran Tensions Send Oil Prices Soaring Amid Strait of Hormuz Concerns

Oil prices surged more than 2% on August 31 amid escalating tensions between the US and Iran, with Brent crude topping $90 a barrel.

The Strait of Hormuz, a key shipping route for global oil supplies, has been at the center of the conflict. The UK Maritime Trade Operations agency reported that a tanker was hit by a projectile while passing through the strait on Saturday.

DBS analyst Souvro Sarkar believes the market is pricing in a contained confrontation rather than a prolonged escalation, with Brent crude potentially staying within the $85, $95-a-barrel range.