Crude oil jumps on fresh Middle East supply fears

Crude oil extended a sharp rally on Thursday as traders reacted to a worsening security backdrop in the Middle East. The move followed two earlier sessions of gains and came as market participants grew more concerned that supply routes could be disrupted for longer than first expected. West Texas Intermediate for October delivery was last quoted 7.09% higher at $102.86 a barrel.

Strait of Hormuz in focus

The latest spike was driven by mounting anxiety over the Strait of Hormuz, one of the world’s most important oil chokepoints. Comments from U.S. President Donald Trump that the conflict could continue for months also damped hopes that shipping through the waterway would normalize soon. That added a fresh layer of uncertainty to an already tense market.

The U.S. and Iran have traded a series of blows in recent days. U.S. Central Command said earlier in the week that it had destroyed three Iranian carriers, while U.S. forces later said they had taken out five more in retaliation for attacks on a U.S. Navy warship. The targets included vessels in the Gulf of Oman and one near Kharg Island.

Escalation threatens regional crude flows

Iran then said it had fired ballistic missiles at a U.S. base in Jordan and at two U.S. Navy vessels. It also said it attacked eight oil tankers that were trying to pass through the Strait of Hormuz after disobeying its orders. Those claims were reported as tensions around the shipping lane intensified, with energy traders watching the situation closely.

The market reaction reflects concern that even a limited confrontation can have outsized effects on global oil supply. When tankers are threatened or delayed in and around the Strait of Hormuz, the risk premium on crude tends to rise quickly. That dynamic was visible in Thursday’s trading, where prices built on the previous sessions’ advance.

The conflict is not the only regional risk being monitored by oil traders. Saudi-Houthi tensions have also been part of the backdrop, reinforcing fears that disruptions could linger. For now, the price move shows how quickly geopolitical developments can outweigh other market factors when a major supply corridor is at risk.

This article is not investment advice and recommends no asset, level or direction; a single session's move is not evidence of a trend. For background see Markets, Bear Market, BIST 100, and for terms the finance glossary.