Oil and gas prices surge amid escalating conflict at the Strait of Hormuz

Tensions in the Middle East have significantly intensified, leading to a sharp rise in global energy prices after a series of military exchanges between the United States and Iran near the Strait of Hormuz. Following U.S. strikes on Tuesday that hit five Iranian tankers, Tehran responded by targeting two American warships, eight oil tankers, and ten commercial vessels attempting to traverse the strategic waterway. As a result, the price of Brent crude exceeded $100 per barrel for the first time since July, reaching $101.21 in recent trading, while U.S. West Texas Intermediate rose to over $96 per barrel.

The conflict has effectively led to a de facto closure of the Strait of Hormuz, with shipping traffic dropping to a handful of vessels per day. The Iranian government claims these actions are a form of legitimate self-defense against U.S. aggression. Concurrently, European natural gas prices have reached approximately 80 euros per megawatt-hour, the highest level since January 2023, driven by these maritime disruptions and concerns over low winter storage levels. International authorities, including the UK Maritime Trade Operations, have confirmed reports of fires on several vessels in the region as the situation remains volatile.