Oil prices settle at one-year high as Hormuz snarls
Synopsis
Oil prices closed near a one-year high as military strikes on Iran and continued disruption in the Strait of Hormuz raised concerns about global supply flows. Brent crude settled at $81.40 per barrel while WTI rose to $74.66. Shipping through the key energy corridor has remained stalled for five days, increasing market volatility. Traders are also watching US inventory data and potential diplomatic signals between Washington and Tehran.
Oil prices settled near their highest levels in more than a year as conflict involving Iran disrupted shipping through the Strait of Hormuz. Brent crude closed at $81.40 per barrel while WTI reached $74.66. Markets are weighing supply risks, tanker traffic disruptions and US inventory data amid ongoing geopolitical tensions.
Key Highlights
- Brent crude settled at $81.40 per barrel, the highest closing level since January 2025.
- US WTI crude rose to $74.66, marking its second consecutive close at the highest level since June.
- Shipping through the Strait of Hormuz remained effectively paralysed for a fifth day, disrupting tanker traffic.
- Middle East tensions intensified after US and Israeli strikes on Iran, raising concerns over global oil supply.
- US crude inventories rose by 3.5 million barrels last week, reaching the highest level in three and a half years.
Oil prices closed near their highest levels in more than a year on Wednesday as escalating military strikes on Iran and continued disruption in the Strait of Hormuz kept energy markets on edge. Traders balanced concerns over potential supply disruptions against signals that diplomatic talks could still take place.
Prices hold near yearly highs
Brent crude settled at $81.40 per barrel, unchanged from the previous session but at its highest closing level since January 2025.
US West Texas Intermediate (WTI) crude rose 10 cents, or 0.1%, to $74.66, marking its second consecutive daily close at the highest level since June.
Earlier in the trading session, Brent surged more than $3 to $84.48 per barrel before easing back. The retreat followed a report indicating that operatives from Iran’s Ministry of Intelligence had signalled openness to talks with the US Central Intelligence Agency.
Strait of Hormuz disruptions tighten supply concerns
The rally has been driven largely by fears that the widening conflict could disrupt energy flows from the Middle East, a region that accounts for just under one-third of global oil production.
Shipping through the Strait of Hormuz, a crucial passage for oil tankers, has remained effectively paralysed for a fifth day. The waterway is one of the world’s most important energy corridors and handles a major share of global crude and liquefied natural gas shipments.
Analysts said the uncertainty around tanker movements has added to price volatility as traders attempt to assess potential supply interruptions.
Analysts warn of prolonged volatility
Nikos Tzabouras, senior market analyst at Tradu.com, said oil prices remain elevated as markets factor in the possibility of a prolonged military campaign and sustained disruptions to supply routes.
He noted that if the conflict intensifies and shipping constraints continue, crude prices could approach the $100 per barrel level.
Dennis Kissler, senior vice president of trading at BOK Financial, said global supply currently appears adequate, with near-record volumes of crude held in floating storage. However, he warned that price swings could continue until tanker traffic through the region stabilises.
US inventory data adds mixed signals
In the United States, government data showed crude inventories increased last week. The Energy Information Administration reported that US crude stockpiles rose 3.5 million barrels to their highest level in three and a half years, exceeding expectations for a 2.3 million-barrel increase.
Meanwhile, gasoline inventories fell by 1.7 million barrels, while distillate stocks increased by 429,000 barrels.
U.S. Defence Secretary Pete Hegseth said Washington was prevailing in the conflict and had the capacity to continue military operations as long as necessary.
White House spokeswoman Karoline Leavitt said President Donald Trump and his advisers were reviewing measures to ensure tanker safety and were discussing the potential US role in Iran after military operations conclude.
Traders are closely monitoring developments around the Strait of Hormuz and any diplomatic progress between Washington and Tehran. Supply risks, tanker traffic conditions and global inventory levels are expected to remain key factors influencing oil price movements in the near term.
Quick FAQs
Q1. Why did oil prices rise to a one-year high?
Oil prices increased due to escalating conflict involving Iran and disruption of tanker traffic in the Strait of Hormuz.
Q2. Why is the Strait of Hormuz important for global oil markets?
The Strait of Hormuz is a key shipping route that handles a significant share of global oil and LNG exports.
Q3. What were the latest Brent and WTI oil prices?
Brent crude settled at $81.40 per barrel, while WTI crude closed at $74.66.
Q4. What did US inventory data show about crude supplies?
US crude inventories rose by 3.5 million barrels last week, reaching the highest level in three and a half years.
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Pooja Malik is a business journalist with over six years of experience covering startups, entrepreneurship, and emerging trends. She has previously worked with leading media platforms such as YourStory Media and BW BusinessWorld, where she reported on business, policy, and market developments. Currently, she serves as Editor at The Inspirepreneur Magazine, where she writes and edits stories across business, lifestyle, and travel, with a focus on clarity, accuracy, and reader relevance.
