Oil prices surge for third day amid Strait of Hormuz tensions

ISLAMABAD: Oil prices rose for a third straight day on the back of the US and Israel’s ongoing war with Iran and concerns about the dangers to shipping through the Strait of Hormuz.

Brent crude rose $1.70 to $79.44 a barrel, its highest since January 2025, after hitting $82.37 during the session. US West Texas Intermediate (WTI) crude rose $1.17 to $72.40 a barrel.

Experts said there was no immediate sign of abating tensions. Market analysts said prices could rise further if the conflict dragged on, especially if Iran targeted more energy infrastructure in the region.

Tensions escalated when Iranian media reported that the Strait of Hormuz had been closed and no ships would be allowed to pass through. About 20 percent of the world’s oil and gas passes through this passage, raising concerns about supply disruptions. Several oil tankers and container ships have changed routes, while insurance companies have also canceled coverage.

The Israeli prime minister has said that the war with Iran may take some time but will not last for years. However, analysts believe that as long as the conflict continues, uncertainty will remain in the markets.

Meanwhile, Saudi Arabia temporarily closed its largest oil refinery after a drone attack, which also sent refined product prices higher. US diesel futures reached a two-year high, while European gas oil also recorded a significant increase.

A global brokerage firm has raised its expected price of Brent crude oil for 2026 from $65 to $80 a barrel, while in the event of a severe and prolonged war, prices are expected to rise to $120 to $150.