Oil prices surged early Monday after fighting flared in the U.S.-Iran conflict for the first time in four weeks since U.S. President Donald Trump announced a "pause" in U.S. military strikes on August 1. File Photo by Bill Greenblatt/UPI | License Photo
Aug. 31 (UPI) -- Oil prices surged early Monday after fighting flared in the U.S.-Iran conflict for the first time in four weeks since U.S. President Donald Trump announced a "pause" in U.S. military strikes on Aug. 1.
The contract for the benchmark Brent crude for November delivery jumped by 3.4% to $91.09 a barrel and the October contract for American crude saw a similar-sized increase to $86.22 after U.S. forces hit rocket launchers on Larak Island in the Hormuz Strait on Sunday night and Iran's military retaliated, targeting American bases in Jordan.
The hikes were driven by the renewed hostilities stoking fears ongoing supply disruption caused by a drastic curtailment of tankers traffic transiting the Strait of Hormuz would be made worse and persist for longer, according to experts.
"Supply risk will persist and oil inventories will continue to deplete in the coming weeks and months. The Iranian crisis has likely changed the security status quo in the Middle East," said PVM Oil Associates' London-based analyst Tamas Varga.
