Oil prices rise as latest fighting resurrects Middle East supply disruption risks

Oil prices climbed on Tuesday (Sep 1) due to the recent fighting between the US and Iran in the Middle East, reigniting concerns about potential supply disruptions from the world's major crude-producing region. Brent crude futures rose 56 cents, or 0.6%, to $91.05 a barrel, while US West Texas Intermediate crude increased 83 cents, or 1%, to $86.59.

Brent had previously reached its highest level in eight weeks, and WTI touched its highest since mid-August. Tensions escalated after US President Trump threatened further strikes against Iran following direct attacks on Sunday. These developments raise the possibility of damage to energy infrastructure in the Gulf and increased uncertainty for shipping through the Strait of Hormuz.

The number of visible crude vessels passing through the Strait has dropped to five per day recently. Despite mediator efforts by Qatar, Oman, and others to broker a deal to reopen the Strait, which carries about a fifth of global oil supplies, tensions remain high. The UK Maritime Trade Operations agency reported a tanker struck by projectiles while sailing out of the Strait, but no casualties or environmental damage were noted.

US-Venezuela oil agreements aim to replenish the US Strategic Petroleum Reserve, currently near a 44-year low.