Oil escalation – Iran hit US bases in Bahrain, Kuwait and Jordan
The renewed exchange of strikes pushed Brent and WTI to fresh multi-week highs for a second straight session, reinforcing the geopolitical risk premium already embedded in crude following last week’s flare-up. Trump’s comment that energy targets would be hit eventually, even while being held back for now, kept alive the tail risk of direct action against Iranian oil infrastructure, a scenario markets have so far avoided pricing in fully. With Tehran reasserting the Strait’s closure and retaliatory strikes spreading to Jordan, Bahrain and Kuwait, the conflict’s geographic footprint continued to widen, deepening doubts that June’s truce can hold and keeping traders focused on supply disruption risk through the Strait.
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Renewed US-Iran strikes pushed oil higher for another session.
Summary:
- Oil rose on Wednesday here after Trump reimposed a naval blockade on all Iranian ports and Iran launched retaliatory strikes on US infrastructure in the region
- Brent closed at its highest since 12 June and WTI at its highest since 15 June for a second straight session, extending gains into early Wednesday trade
- The US began a fresh round of strikes early Wednesday aimed at degrading Iranian capabilities used to attack shipping in the Strait of Hormuz
- Tehran said it had again closed the Strait after hostilities reignited last week, straining the fragile truce reached in June
- Trump told Fox News that energy targets would ultimately be hit, though he was saving them for last
- Iran’s army said it launched drone attacks on US positions at Jordan’s Azraq base, while the Islamic Revolutionary Guard Corps said it targeted weapons and storage facilities in Bahrain and Kuwait
Oil prices rose further on Wednesday after President Trump reimposed a naval blockade on all Iranian ports and Iran responded with retaliatory strikes on US infrastructure across the region, extending a rally that had already pushed crude to a one-month high a day earlier. Brent closed at its highest level since 12 June and WTI at its highest since 15 June for a second consecutive session, with both benchmarks rising further in early Wednesday trade.
Tuesday’s close came as attacks deepened supply disruption concerns in the Strait of Hormuz, through which roughly a fifth of the world’s oil and liquefied natural gas moved before the war began. Early Wednesday, the US military said it had launched a fresh round of strikes intended to continue degrading Iranian capabilities used to attack commercial shipping in the Strait. Tehran said it had once again closed the waterway after hostilities between Iran and the US reignited last week, further straining an already fragile truce reached in June following several months of fighting.
Trump, speaking in an interview aired on Fox News Tuesday night, said energy targets would ultimately be struck, though he indicated he was holding them back for now, saving them for last. The remark kept markets alert to the possibility that Washington could still escalate toward direct action against Iranian energy infrastructure, even as the current campaign avoided that step.
The conflict’s reach continued to widen overnight. Iran’s army said it had launched drone attacks against US positions at Jordan’s Azraq base, though there was no immediate comment from the Pentagon, while Iran’s Islamic Revolutionary Guard Corps said it had targeted weapons and storage facilities in Bahrain and Kuwait.
This article was written by Eamonn Sheridan at investinglive.com.