Oil prices rise 2% as US-Iran fighting stokes supply fears

Oil prices climbed about 2% to a one-week high on Wednesday as a resumption in fighting between the U.S. and Iran renewed fears of supply disruptions from the Middle East.

Brent futures rose $1.55, or 1.7%, to $92.04 a barrel at 10:33 a.m. EDT (1433 GMT). U.S. West Texas Intermediate (WTI) crude rose $1.84, or 2.2%, to $87.60.

That puts Brent on track for its highest close since August 24 and WTI on track for its highest close since August 20.

Iran said on Tuesday it would reciprocate if the U.S. honored its commitments under a June interim deal on halting their conflict. Tensions remained high after U.S. President Donald Trump threatened Tehran with further strikes.

Oil prices rose on Monday after the first exchange of direct attacks between the U.S. and Iran since late July, and following reports of two tankers coming under fire leaving the Strait of Hormuz, the global oil supply waterway that Iran has effectively closed to shipping.

The six-month-old conflict had shifted into an economic standoff before a U.S. attack on Iran's Larak Island on Sunday, which Iran responded to by launching missiles overnight at two U.S. air bases in Jordan.

"Fresh hostilities between the U.S. and Iran raised concerns about prolonged disruptions to energy flows through the Strait of Hormuz," Saxo Bank analyst Ole Hansen said.

The number of visible commodity vessels transiting the Strait of Hormuz held at about five on Monday, below the 10-day average of about 14 per day, Kpler shipping data showed. None of the five ships were liquid tankers. 

Analysts polled by Reuters in August expected oil prices to remain above $80 a barrel in 2026 as shipping disruptions continue.