Following the escalation of tensions in West Asia, with the US and Iran launching attacks against each other, international crude oil prices surged by nearly 8% in a single day amid fears of supply disruptions.
Brent crude futures, the global benchmark, were trading at $79.75 per barrel, up 7.54% or $5.59, at 8:21 pm IST. US West Texas Intermediate (WTI) crude rose 7.21% or $5.12 to $75.56 per barrel. A day earlier, Brent crude was trading at around $71 per barrel.
The rally in crude prices gathered further momentum after the US administration on Wednesday revoked a general licence that had temporarily eased oil sanctions on Iran, allowing the country to export certain petroleum products. The licence, issued in late June, was originally valid until August 21.
The move came hours after three tankers, including a Qatari LNG carrier, were reportedly struck in separate incidents in the Strait of Hormuz, raising concerns over the security of one of the world's most critical energy shipping routes.
In retaliation, the US also carried out strikes on multiple targets in Iran, including air defence systems, command-and-control networks, coastal radar sites and anti-ship missile capabilities. Iran, in turn, claimed it had launched attacks on US military bases in Bahrain and Kuwait.
"US Central Command forces have begun launching a series of powerful strikes against Iran to impose heavy costs for targeting and attacking commercial shipping crewed by innocent civilians in an international waterway," the US Central Command said in a post on X.
Meanwhile, the tightening of sanctions on Iran could have implications for crude supplies. According to reports, some Indian oil companies had placed orders for Iranian crude after a memorandum of understanding was signed in mid-June. Iran subsequently accelerated crude loadings from its key export terminal at Kharg Island and moved tankers out of the Gulf before the latest escalation.
As a result, Iran is estimated to have around 63 million barrels of crude oil either in transit or idling on tankers stretching from the Persian Gulf to the Strait of Malacca.
