Oil Prices Rally as Middle East Conflict Disrupts Hormuz Transit

The maritime attack targeted a Qatari LNG carrier, a Saudi tanker, and a Liberian-flagged vessel, prompting immediate retaliation from U.S. forces. CENTCOM reported strikes against Iranian air defense systems, coastal radar sites, and over 60 small boats belonging to the Islamic Revolutionary Guard Corps to secure the trade corridor. Iran responded by launching strikes on U.S. military bases in Bahrain and Kuwait, effectively shattering last month’s fragile ceasefire.

In addition to the military escalation, the United States canceled its sanction waiver for Iranian crude exports. Analysts note that these events challenge market assumptions of an impending supply glut. Saul Kavonic of MST Marquee observed that the conflict highlights the extreme fragility of the Strait of Hormuz, forcing traders to reconsider record short positions as geopolitical risk returns to the forefront of energy pricing.