Oil Prices Rise as US and Iran Resume Attacks

Oil prices climbed nearly 2% on Monday after the United States struck an Iranian island in the Strait of Hormuz and Iran reportedly retaliated against US bases in Jordan. The conflict has now extended into its sixth month, adding fresh pressure to a waterway central to global oil shipments.

Brent crude futures rose $1.77, or 2%, to $89.87 a barrel by 0733 GMT. US West Texas Intermediate gained $1.45, or 1.74%, to $84.85. Both benchmarks are still set for small monthly declines in August after falling more than 4% last week.

US forces struck two launchers on Larak Island on Sunday, the first known American strikes on Iran since late July. Iranian media, citing the Revolutionary Guards, reported that Iran attacked two US air bases in Jordan. The claims followed a statement by President Donald Trump that Iran's Kharg Island energy hub was being “blown to smithereens.” There was no evidence in the report that Kharg Island had come under attack, and Iran denied the claim, saying oil operations continued.

Negotiations to end the conflict remain at an impasse as mediators try to reopen the Strait of Hormuz. One-fifth of the world's oil passed through the strait before the war began at the end of February. Shipping data showed only five visible commodity vessels a day crossed over the weekend, while the United Kingdom Maritime Trade Operations said a tanker was hit by a projectile while sailing inbound on Saturday.

US Treasury Secretary Scott Bessent said the United States was likely to impose new secondary sanctions on Iran each week. Trump also said oil from a recently struck deal with Venezuela would replenish the US Strategic Petroleum Reserve, which has fallen near its lowest level in 44 years.

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blown to smithereens