(RTTNews) – Reversing the losses from Friday’s session, crude oil prices have catapulted on Monday amid intense attacks between the U.S. and Iran over the weekend, renewing Middle East tensions. In addition, contrasting claims by both nations over control of the Strait of Hormuz led to a decline in vessel traffic.
WTI Crude Oil for August month delivery was last seen trading at $78.28 per barrel, up by $6.87 (+9.62%).
After the U.S. and Iran agreed to halt their attacks for 60 days and signed a Memorandum of Understanding on June 17, Iran reopened the Strait of Hormuz, resulting in the resumption of shipping traffic across the seaway.
An intense exchange of attacks between the U.S. and Iran over the weekend and contradictory claims by the U.S. and Iran over the authority and control of Strait of Hormuz has brought back oil supply-related concerns.
Iran’s Islamic Revolutionary Guards Corps fired at a Cyprus-flagged container vessel M/V GFS Galaxy in the Strait of Hormuz, off the northern coast of Oman. The ship had left the port of Jebel Ali of the United Arab Emirates on July 9.
According to the U.K. Maritime Trade Operations, the crew were forced to abandon the ship and escape via lifeboat since the vessel caught fire after the attack.
Omanian rescue teams recovered 23 crew members and offered them medical care while search operations are on for one missing Indian seafarer.
The Islamic Revolutionary Guards Corps announced that the Strait of Hormuz will be closed until further notice.
In response, under the orders of U.S. President Donald Trump, U.S. forces targeted nearly 140 Iranian military sites aimed to degrade Iran’s ability to conduct further attacks on vessels.
A barrage of missiles and drones were launched by Iran in retaliation, targeting U.S. bases in Qatar, Bahrain, Kuwait, Oman, and Jordan.
U.S. Secretary of War Pete Hegseth stated that Iran made a poor choice for which it has to pay.
U.S. Central Command announced its preparedness to safely escort ships across the Strait of Hormuz while Iran reaffirmed its authority over the strait once again.
To avoid attacks, sailors refrained from transiting through the strait.
According to maritime trade intelligence company Kpler, only six ships passed through the strait yesterday, the lowest in five weeks. In particular, oil and gas tanker traffic has hit a low not seen since May 25. However, Kpler admits that several vessels could be turning off their trackers to disable their detection, and hence the actual numbers could vary.
Trump reinstated the blockade on Iranian ships across the strait. Calling the U.S. as guardian angel of the Strait of Hormuz, Trump expressed his intent to take full control of the strait with plans to charge a 20% toll on eligible cargo as costs to cover for the U.S. expenses in providing safety.
In its monthly oil market report released today, the Organization of the Petroleum Exporting Countries predicted that the global demand for oil for 2026 is set to grow by 800,000 barrels per day year-on-year.
In its June report, the alliance speculated global oil demand growth of 1,000,000 bpd year-on-year for 2026. However, OPEC did not cite any clear reason for the downgrade.
For 2027, the global oil demand is estimated to rise by nearly 1.90 million bpd year on year, an upward revision from June months’ forecast of 200,000 bpd.
The U.S. dollar index was last seen trading at 101.23, up by 0.28 (or 0.28%) today.
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