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The front month contract on Brent crude, the international standard for oil prices, crossed $100 per barrel again on Wednesday morning while the US standard, WTI, hovered around $95.
Prices have risen almost 20% since the middle of last week as fighting around the world’s most important oil chokepoint has once again intensified.
It is also the first time since 23 July that oil has hit the $100 mark.
US Central Command said its forces destroyed five Iranian tankers carrying crude oil on 8 September after Iran’s Revolutionary Guard fired ballistic missiles at a US Navy warship twice within two days. The command did not identify the ship, but said it was not hit and continued patrolling regional waters.
It followed a similar strike on 5 September, when Iranian forces fired ballistic missiles at a US aircraft carrier and a destroyer, both of which evaded the attack. The command responded by disabling or destroying three Iranian tankers.
Tehran retaliated by firing missiles at a US military base in Jordan, where air defences intercepted most of them, and renewed threats to target tankers in Kuwaiti and Bahraini waters.
Iran has also repeatedly warned vessels against using unauthorised routes through the Strait of Hormuz.
Mohsen Rezaei, secretary of Iran’s Supreme National Security Council, said Tehran would soon declare an exclusion zone outside the strait, warning that any vessel entering without Iranian coordination would be added to a sanctions list.
Saudi Arabia has been drawn in too, with Aramco facilities at Jazan attacked again on Monday, though damage was reported as limited.
Roughly 7 million barrels a day are still moving through the Strait of Hormuz, against about 20 million before the war began on 28 February.
No end in sight
The military escalation is running alongside a financial one.
Washington launched Operation Economic Outcast in late August, an effort to sever Iran from the global financial system by targeting its access to digital assets, technology, gold, aviation and shipping.
The US Treasury designated close to 60 companies, individuals and vessels at the outset and has signalled fresh measures weekly, with the European Union endorsing the campaign this month.
Rhetoric on both sides has hardened.
US Secretary of War Pete Hegseth said the country “will destroy [and sink]” Iranian oil tankers if Iran fires on American vessels while the Iranian parliament speaker Mohammad Bagher Ghalibaf replied by stating “strike our assets and you get struck”.
US President Donald Trump has continued to insist the waterway is functioning, posting on Truth Social last week that “Hormuz volumes are BACK” and claiming 18 million barrels a day were flowing.
However, the US Energy Secretary Chris Wright put Monday’s figure at 17 million barrels of crude and products combined, while acknowledging the multi-day rolling average is considerably lower.
During last week’s White House press conference, US Vice President JD Vance also declined to categorise the ongoing conflict as a war and stated that “the only reason we do not have a worldwide energy crisis is because of the leadership of the President.”
Faced with the latest developments, analysts are adjusting upward.
Goldman Sachs raised its Brent and WTI forecasts by $5 on Monday to $85 and $80, respectively, for December and warned prices could exceed $120 next year should Gulf output remain 4 million barrels a day below pre-war levels, though the bank does not treat that as its base case.