Oil Prices Climb Above $101 as U.S.-Iran Tensions Escalate
Brent crude closed at $101.21 per barrel, its highest level since May, after U.S. military action against Iranian tankers and retaliatory attacks heightened market concerns.
Oil prices broke the $100 barrier on Wednesday, with Brent crude finishing at $101.21 a barrel and U.S. West Texas Intermediate at $96.05, both marking their highest closes since late May. The surge followed a U.S. military operation that destroyed five Iranian tankers after attempted missile attacks on a Navy vessel, prompting Tehran to strike U.S. ships and a base in Jordan. Additional attacks by a Tehran-backed rebel group ignited oil facilities in Saudi Arabia, raising fears of further escalation.
Since the start of the year, the two benchmarks have risen roughly 70%, and they have gained about 40% since the conflict with Iran began on Feb. 28. Analysts warned that continued stalemate could push Brent prices toward $120 or higher.
The White House and congressional Republicans are monitoring the situation closely ahead of the upcoming midterm elections, as higher fuel costs affect consumers. President Donald Trump said he expects gasoline prices to fall below $2 per gallon "right after the election" in November, adding that the decline may take longer than the midterms.
"I think it’s going to take a little bit longer than the midterms," Trump said.
The conflict has also disrupted oil flows through the Strait of Hormuz and the Red Sea, where Iran-backed Houthi rebels have targeted tankers and Saudi energy sites.