West Texas Intermediate (WTI), the U.S. crude benchmark, remains firmly higher despite easing slightly from intraday peaks during Monday’s Asian session. The move is driven by escalating geopolitical tensions between the United States and Iran, raising renewed concerns over potential supply disruptions in the strategically critical Strait of Hormuz.
Oil markets reacted sharply following reports of intensified hostilities over the weekend. Attacks on commercial vessels in the region have heightened fears of a breakdown in the fragile ceasefire, pushing crude prices higher. WTI for May delivery surged approximately 6% to $88.93 per barrel, while Brent for June rose around 5.6% to $95.48.
Tensions escalated after a series of military and maritime incidents. The U.S. Navy reportedly engaged an Iranian container ship in the Gulf of Oman and later took control of the vessel. This followed an earlier attack attributed to Iran, in which tankers transiting the Strait of Hormuz came under fire from Revolutionary Guard units, according to maritime security sources.
Adding to market uncertainty, U.S. President Donald Trump issued strong warnings, threatening severe retaliation if Iran does not agree to revised terms. The current ceasefire is set to expire this week, with recent developments already described as violations.
Diplomatic uncertainty continues to weigh on the outlook. While initial plans pointed to renewed peace talks in Islamabad, Iran has reportedly declined participation, citing the ongoing U.S. naval presence and unresolved disputes.
The latest escalation follows a brief period of optimism late last week, when both sides appeared close to a breakthrough. Oil prices had declined on Friday after Iran signaled a potential reopening of the Strait of Hormuz, but sentiment quickly reversed as tensions resurfaced.
With neither side de-escalating and uncertainty surrounding the Strait persisting, oil markets are likely to remain volatile in the near term, driven by geopolitical risk and supply concerns.
