International oil prices surged after U.S. airstrikes on Iran and the revocation of permits to sell crude, following attacks on Qatari and Saudi Arabian vessels in the Strait of Hormuz. The risk level for transiting the strait was raised to the highest tier, shaking the global energy market again.
On the 7th (local time), according to major foreign media outlets including Bloomberg, Reuters, and Al Jazeera, international oil prices jumped amid U.S. strikes on Iran and rising tensions in the Strait of Hormuz. West Texas Intermediate (WTI) briefly topped $72 a barrel intraday, and Brent rose nearly 6% in after-hours transaction to exceed $76 a barrel. Gulf tanker charter rates also jumped from under $200,000 per day last week to around $300,000.
Vessel traffic through the Strait of Hormuz tightened again. An average of 25 to 40 ships passed through the strait per day over the past week, but on this day the number fell to 16, the lowest in about three weeks. That is a sharp drop compared with an average of 125 ships per day before the conflict. The U.S. Navy-led Joint Maritime Information Center (JMIC) raised the strait transit risk level from "substantial" to the highest level, "severe," and urged ships to exercise extreme caution.
The United States withdrew an earlier sanctions waiver that had allowed sales of Iranian crude, then carried out airstrikes on Iran. U.S. Central Command (CENTCOM) said on social media platform X, "We conducted powerful airstrikes to exact a heavy price for attacks on merchant vessels in international waters carrying innocent civilians," adding, "Iran's attacks are not only dangerous but also a clear violation of the cease-fire agreement."
Reuters said U.S. forces focused strikes on Iran's air defenses and coastal surveillance systems, surface-to-air missiles, anti-ship cruise missiles, and drone launch sites. Iran's Mehr News Agency reported sounds of explosions near the Strait of Hormuz and at the southern port of Sirik.
The U.S. Treasury in June issued a general license temporarily allowing sales of Iranian crude and petroleum products under a U.S.-Iran interim deal, but revoked it on the 7th after the merchant vessel attack in the Strait of Hormuz. U.S. forces then carried out airstrikes on Iranian military facilities.
The United States and Iran each claim the other violated the cease-fire first. The United States blamed Iran for the attacks on Qatari and Saudi Arabian merchant vessels in the Strait of Hormuz, while Iran warned that the U.S. airstrikes and the revocation of crude sales permits violated the bilateral agreement and said it would "respond resolutely."
The interim agreement the two sides reached in June centered on halting attacks on merchant vessels in the Strait of Hormuz and allowing sales of Iranian crude for 60 days to secure time to negotiate nuclear program and strait operations issues. But starting with Iran's attack at the end of June on a Singapore-flagged container ship, tit-for-tat retaliation has continued, putting the deal on shaky ground.
Experts said the latest developments have again increased uncertainty around the Middle East energy supply chain. Bob McNally, president of consulting firm Rapidan Energy Group, said, "Revoking the crude sales permit is a signal that the cease-fire may not be as solid as the market expected," adding, "The market must reprice risk."
David Schenker, who served as Deputy Minister for Middle East affairs in the first Trump administration, said, "These strikes are an expression of the U.S. administration's frustration," adding, "Expectations that Iran would faithfully implement the agreement were overly optimistic. The war is dragging on."