Brent crude jumped as high as $87 a barrel on Tuesday, its highest since June, as the U.S. moved to reimpose a blockade on Iranian ports and struck military targets across Iran. Both benchmarks have climbed more than 10% since Sunday, driven by fears over shipping through the Strait of Hormuz.
International benchmark Brent crude jumped as high as $87 per barrel on Tuesday, the first time since June it has traded at that level. U.S. crude also climbed as high as $81 per barrel during the session.
Prices then eased after President Donald Trump said on social media he was dropping a proposed Strait of Hormuz "reimbursement fee", a toll widely viewed as a breach of international maritime law. U.S. crude still closed up 1.5% at $79.34, while Brent ended the day up 1.7% at $84.32.
Strikes and a renewed blockade drive the move
Both benchmarks have risen more than 10% since trading opened Sunday night, leaving oil prices up about 40% since the start of the year. The U.S. military is reimposing a blockade on Iranian ports and ships in the Strait of Hormuz, set to take effect at 4 p.m. ET.
Renewed attacks between U.S. and Iranian forces have added to the pressure. The U.S. military said Monday night that its forces struck targets including Bushehr, Chah Bahar, Jask, Konarak, Abu Musa and Bandar Abbas to degrade Iran’s ability to attack commercial shipping. After Trump proposed the toll Monday, the International Maritime Organization said there was no legal basis for the fee.
Shipping through Hormuz thins out
ING commodities analysts argued the blockade matters more than earlier measures, writing that the U.S. return is "much more impactful" than the previous suspension of the sanction waiver on Iranian oil.
Traffic there is thinning fast. On Friday, 19 ships transited the strait, rising to 24 on Saturday, but by Monday the count had fallen to just 10 vessels, according to data from Kpler.
Source: NBC News
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