Oil prices extended their gains in Asian trading on Thursday, rising more than 2% to their highest levels in over six weeks as escalating security threats in the Strait of Hormuz and the Red Sea heightened concerns over global crude supplies.
Brent crude futures surged $2.20 (2.3%) to $96.27 per barrel, the highest level since early June, after settling at $94.07 in the previous session following a gain of more than 3%.
US West Texas Intermediate (WTI) crude also advanced, climbing $1.65 (1.9%) to $88.48 per barrel, building on Wednesday’s 3% rally.
Market sentiment was driven by renewed geopolitical tensions after Iran’s Islamic Revolutionary Guard Corps (IRGC) reported that an oil tanker caught fire following an explosion while attempting to navigate what it described as a mined route south of the Strait of Hormuz. Two additional tankers reportedly turned back amid the heightened security risks.
In a statement, the IRGC claimed the Strait of Hormuz was under its control and “completely closed” while US military operations continued in the region, warning that no tanker would be permitted to enter or leave without coordination with Iranian authorities.
Adding to supply concerns, Yemen’s Iran-aligned Houthi movement announced a naval blockade targeting Saudi Arabia and threatened vessels transporting Saudi crude through the Bab el-Mandeb Strait. The group claimed it had attacked two Saudi oil tankers, including the Saudi-flagged Encelia, which maritime security reports said was struck in the Red Sea.
The Houthis further claimed that around ten commercial vessels had been forced to abandon their voyages after receiving warnings against sailing to Saudi ports. Reuters could not independently verify these claims.
Analysts noted that oil markets are facing the unusual prospect of simultaneous disruptions at both the Strait of Hormuz and the Bab el-Mandeb Strait—two of the world’s most strategically important energy shipping routes.
“Geopolitical premiums have returned, but a sustained price rally will require evidence of prolonged shipping disruptions or significant supply outages,” said Priyanka Sachdeva, Senior Market Analyst at Phillip Nova.
Saul Kavonic, Head of Energy Research at MST Marquee, warned that the emerging threat to Red Sea shipping could disrupt as much as 5 million barrels per day of oil flows, affecting the primary export route used by Gulf producers to bypass the Strait of Hormuz.
Meanwhile, the US military confirmed it had carried out its 12th consecutive night of strikes on Iran, escalating regional tensions. The latest operations followed US President Donald Trump’s warning that the United States would retaliate against Iranian attacks on shipping in the Strait of Hormuz by targeting critical Iranian infrastructure, further intensifying concerns over the security of global energy supplies.
With geopolitical risks mounting across key maritime chokepoints, energy markets remain focused on the potential for prolonged supply disruptions and their impact on global oil prices.
Story Reuters
