Oil prices surged Thursday, with Brent crude hitting $108 per barrel for the first time since May, as traders brace for a more prolonged supply shock caused by the Iran war.
Oil prices have climbed back above the $100 per barrel mark this week as fighting in the Straight of Hormuz and Red Sea has intensified. The US and Iran have traded strikes, while the Iran-backed Houthis have attacked Saudi Arabia and ignited tensions in the Bab al-Mandab Strait.
Brent crude, the global oil benchmark, rose 6.9% and traded at $108.10 per barrel. US crude rose 7.2% and hit $103 per barrel for the first time since May.
Resurgent conflict has stoked concerns of further disruptions to global oil supplies and the flow of crude through the Strait of Hormuz.
“The step up in attacks in the Strait of Hormuz and by the Houthis against Saudi Arabia suggests that Iran and its proxies are trying to regain the initiative in the war,” Jason Tuvey, deputy chief emerging markets economist at Capital Economics, said in a note.
