WTI Oil climbs toward $87 as US-Iran tensions threaten supply

West Texas Intermediate (WTI) oil prices rose to near $87 on Tuesday, driven by heightened geopolitical risks stemming from recent tensions between the United States and Iran. US forces targeted two Iranian rocket launchers on Larak Island in the Strait of Hormuz, while Tehran retaliated by striking US facilities in Jordan. President Trump warned of further potential military action against Iran.

The situation also centered around threats to Kharg Island, a crucial component in Iranian oil exports. Any disruption to these facilities could impact global oil supply. The Strait of Hormuz, a key shipping route, saw operational risks following a supertanker collision with mines. Despite partial shipping continuing by Gulf producers, concerns over Middle Eastern supply remain high.

Meanwhile, drone and missile attacks in Ukraine on Russian refineries exacerbate concerns over refined-product availability. WTI oil is a high-quality crude commonly benchmarked for international markets, sourced from the United States and distributed through the Cushing hub. Analysts note that the recent price increase is primarily due to the Middle East escalation, with President Trump indicating a limited US response to Iran's attacks while emphasizing the conflict's limited scale.

Global growth, OPEC decisions, US Dollar value, and OPEC+ meetings are additional factors influencing WTI oil prices.