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US Oil Prices Surge Nearly 3% After Military Strikes Against Iran Spark Supply Fears
Market Reaction and Geopolitical Tensions
Oil Price Movements Following US Military Action
TOKYO, July 8 (Reuters) – U.S. oil prices jumped nearly 3% in early trade on Wednesday, extending the previous session’s gains, after the U.S. military launched a series of strikes against Iran, heightening concerns that a fragile truce was faltering.
Details of the US Strikes and Iranian Response
The strikes against Iran were in response to Iranian attacks on three commercial vessels that were transiting the Strait of Hormuz, U.S. Central Command said on Tuesday.
Impact on West Texas Intermediate Crude
U.S. West Texas Intermediate crude was up $1.95, or 2.8%, at $72.39 a barrel as of 2215 GMT.
WTI settled 2.8% higher on Tuesday before extending gains in post-settlement trade, after the U.S. revoked the general licence authorising the sale of Iranian crude following the Iranian attacks on commercial vessels.
Regional Reactions and Security Concerns
Qatar and Saudi Arabia Involved in Incidents
Qatar blamed Iran for attacking the vessels, including the huge Qatari liquefied natural gas tanker, the Al Rekayyat, which reported being struck by a drone that caused a fire in its engine room. The crew were safe and being evacuated.
A Saudi-flagged crude oil tanker, believed to be the supertanker Wedyan, was also damaged off Oman, maritime security sources said. The cause was not immediately clear.
Fears Over Strait of Hormuz Disruptions
The developments reignited fears of disruptions to tanker traffic through the Strait of Hormuz.
(Reporting by Yuka Obayashi; Editing by Jamie Freed)
