Oil prices surged Wednesday as the US-Iran standoff over control of the Strait of Hormuz continued. A worker fuels a vehicle at a gas station in Manila, Philippines. [EPA]
Oil prices surged Wednesday as the US-Iran standoff over control of the Strait of Hormuz continued. A worker fuels a vehicle at a gas station in Manila, Philippines. [EPA]

International oil prices surged as military tensions between the United States and Iran intensified. The rally was driven by repeated warnings from President Donald Trump about potential strikes on Iranian infrastructure, compounded by Houthi rebel threats against Red Sea shipping lanes that stoked fears of crude supply disruptions.

Brent crude futures for September delivery settled at $94.07 a barrel on the ICE Futures Exchange on Wednesday, up 3.36 percent from the previous session.

West Texas Intermediate futures for September delivery also rose 2.95 percent to $86.83 a barrel on the New York Mercantile Exchange.

Markets focused on hawkish statements from senior US officials and the expanding geopolitical risk surrounding the Strait of Hormuz.

Secretary of State Marco Rubio, speaking in the Philippines where he was attending an ASEAN foreign ministers' meeting, said the United States preferred a diplomatic resolution and would be willing to reach a deal with Iran, but warned that "the current problem is that Iran is not serious about talks."

Trump also warned on his Truth Social platform that if Iran attacked vessels passing through the Strait of Hormuz, the United States would bomb Iranian bridges and power plants.

Anxiety over crude supply routes deepened after Iran-aligned Houthi rebels in Yemen declared a blockade on ships traveling to and from Saudi Arabian ports. Analysts said the threat to Red Sea shipping lanes — an alternative route bypassing the Strait of Hormuz — had significantly expanded the risk of supply disruptions.

Market observers said the geopolitical risk premium was likely to persist as long as the US-Iran standoff continued, keeping upward pressure on global oil prices.


sjy@heraldcorp.com