Oil prices climbed sharply on Monday as rising Middle East tensions increased concerns about disruptions to global energy supplies. Brent crude for November delivery rose 2.8% to $107.54 a barrel. Meanwhile, US benchmark West Texas Intermediate for October gained 2.3% to $102.34.
Both contracts extended their gains from last week. They also remained above the key $100-a-barrel level.
Strait of Hormuz Risks Pressure Oil Markets
Investors continued to focus on growing security risks across the Middle East. In particular, concerns around the Strait of Hormuz added pressure to global oil markets.
Saudi Arabia temporarily shut its East-West pipeline after drone attacks, according to reports.
Moreover, Iranian authorities said a merchant vessel came under attack in the Strait of Hormuz on Sunday. The incident killed one person and injured three others.
The developments have raised fresh concerns about one of the world’s most important energy routes.
Before the conflict, vessels could pass through the strait without seeking special permission. However, Iran now requires ships to obtain approval before transit.
Iran is also considering a system to charge vessels service fees for using the waterway.
Oman Postpones Iran-Gulf Talks
The situation has further complicated efforts to secure the strategic waterway.
Oman has postponed planned talks between Iran and Gulf states over the future of the Strait of Hormuz.
The waterway plays a crucial role in global energy trade. A large share of the world’s seaborne oil shipments passes through the strait.
Therefore, any prolonged disruption could put additional pressure on oil prices and global energy markets.
For now, traders are closely monitoring developments across the region. Further attacks or restrictions around the Strait of Hormuz could push crude prices even higher.
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