Oil prices jump as US and Iran trade attacks over Strait of Hormuz
Summary
Oil prices increased by more than 4 percent due to new clashes between the United States and Iran near the Strait of Hormuz, a vital shipping route. The U.S. military launched strikes against Iran after accusing Iran of attacking a container ship, and Iran responded with missile and drone attacks on nearby countries.Key Facts
- Brent crude oil prices rose to $79.29 a barrel, the highest since June 22.
- The U.S. Central Command carried out dozens of strikes on Iran to weaken its ability to attack ships in the Strait of Hormuz.
- The U.S. accused Iran of attacking the Cyprus-flagged container ship MV GFS Galaxy.
- Iran attacked the United Arab Emirates, Qatar, Kuwait, Oman, and Bahrain with missiles and drones in response to U.S. strikes.
- Iran’s Persian Gulf Strait Authority warned that ships not using Iran’s preferred route through the strait would not be protected.
- Maritime traffic in the Strait of Hormuz has dropped sharply due to the conflict, from about 130 vessels daily before the war to fewer than 10 recently.
- The Strait of Hormuz is key for global oil trade, handling about one-fifth of it in peacetime.
- Analysts expect oil prices to stay high in the upper $70s per barrel for August and September due to ongoing uncertainty.
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