Oil Prices Surge More Than 5% as Iran Conflict Escalates

Oil prices surged more than 5% on Wednesday after U.S. President Donald Trump said a temporary agreement aimed at ending the conflict with Iran had collapsed, warning that the United States could launch new strikes.

The renewed escalation between Washington and Tehran pushed energy markets higher after Iran announced attacks on U.S. military positions in Bahrain and Kuwait in response to earlier American strikes on Iranian targets following attacks on oil tankers in the Strait of Hormuz.

The latest developments weakened hopes that a fragile ceasefire could evolve into a permanent peace agreement. The previous understanding, signed on June 17, had been viewed as a potential pathway toward ending the conflict that began with U.S. and Israeli airstrikes on Iran on February 28.

Latest Oil Prices:

WTI Crude • 74.51 +4.07 +5.78%

Brent Crude • 79.06 +4.90 +6.61%

Murban Crude • 74.39 +5.42 +7.86%

WTI Midland • 74.42 +3.88 +5.50%

Opec Basket • 72.36 +1.99 +2.83%

Indian Basket • 68.21 -2.50 -3.54%

Natural Gas • 3.224 -0.041 -1.26%

Gasoline • 3.129 +0.175 +5.91%

Heating Oil • 3.722 +0.420 +12.72%

The renewed security concerns surrounding the Strait of Hormuz, one of the world's most important energy transit routes, triggered a sharp rise in crude prices.

Brent crude futures climbed more than 5% to reach $78.48 per barrel, marking the largest daily increase since late May.

Shipping data showed that at least four oil and gas tankers had turned back rather than pass through the strategic waterway, highlighting growing concerns over potential disruptions to global energy supplies.

Although oil prices remain well below levels above $120 per barrel recorded during the peak of previous conflict-related market stress, the latest increase has revived concerns over a new inflationary wave, particularly amid declining global oil inventories. U.S. stock markets also closed lower following the escalation.

Trump said the temporary agreement with Iran had ended, expressing doubts that any future deal would hold.

"If we make a deal with Iran, I'm not sure it will last," Trump said, adding that he believed negotiations had become unproductive.

Before meeting Ukrainian President Volodymyr Zelenskyy, Trump warned reporters of possible further action, saying: "We will hit them hard tonight."

However, he did not explicitly confirm a return to a full-scale war, and it remained unclear whether diplomatic efforts toward a permanent agreement would continue.

Iran's Islamic Revolutionary Guard Corps (IRGC) said it had targeted U.S. military sites in Bahrain and Kuwait and claimed to have downed an American MQ-9 drone during the operation.

The Bahraini military, however, said it had successfully intercepted the Iranian attacks.

Earlier, the United States had carried out additional military strikes and revoked authorization allowing Iran to sell oil, following attacks on three oil tankers in the Strait of Hormuz.

The U.S. Central Command said the operation targeted more than 60 small vessels belonging to the IRGC, describing the action as a response intended to impose significant costs on Iran for threatening maritime traffic despite the ceasefire arrangement.

Trump said U.S. forces had destroyed 28 boats overnight and suggested additional strikes could follow. He also confirmed that recent attacks targeted Kharg Island, Iran's largest oil export hub, warning that the island could be targeted again.

NATO Secretary General Mark Rutte said the latest U.S. strikes on Iran were necessary.

Meanwhile, European Union foreign policy chief Kaja Kallas warned that continued exchanges of attacks were complicating efforts to end the conflict, saying Iranian attacks on Bahrain and Kuwait were unacceptable.

Iran's Khatam al-Anbiya Central Headquarters described the U.S. strikes as "blatant aggression" and vowed a strong response, while insisting that Tehran would not allow American intervention in managing the Strait of Hormuz.