Oil prices experienced a significant climb, with Brent crude futures nearing $100 per barrel, driven by reports of a second undisclosed Iranian attack on U.S. Navy ships. This escalation adds to already heightened geopolitical tensions in the Middle East, following recent military exchanges and attacks on energy infrastructure.
The situation is further complicated by Houthi militant actions in Saudi Arabia and ongoing diplomatic and military rhetoric between the U.S. and Iran. Analysts warn of potential further volatility and increased oil prices if regional shipping routes remain disrupted.
Oil Surges Past $99 Amid Reports of Second Undisclosed Iranian Attack on U.S. Navy Vessels
New York - Oil prices surged Tuesday in extended hours trading, with Brent crude futures climbing about 2% to $99.05 per barrel and U.S. West Texas Intermediate crude up 2.8% at $94.04. The rally was fueled by reports indicating Iran launched a second, previously undisclosed wave of attacks on U.S. Navy ships this week, escalating tensions in the region.
Video: Argus warns oil could surge past $100 with Strait of Hormuz tensions escalating. (Duration: 05:23)
According to The Wall Street Journal, U.S. officials revealed that Iran attempted to attack Navy ships on Monday, following an earlier incident over the weekend where Iran targeted an aircraft carrier with ballistic missiles. While the Pentagon has not publicly confirmed the Monday incident, no U.S. ships were reported hit in either attack. Concurrently, Iranian state media reported that a U.S. missile struck a small oil tanker near Kharg Island on Tuesday.
These developments come as oil prices have already climbed over 8% in September, marking the first exchange of military strikes between the U.S. and Iran since July. The conflict widened this week with attacks by Iran-allied Houthi militants in Yemen on several energy facilities in Saudi Arabia, leading to temporary operational halts. The attacks, which caused fires at energy facilities and injured over 70 civilians, prompted Saudi Arabia to affirm its right to take necessary measures to defend its sovereignty and national assets.
Strike our assets and you get struck.
— Mohammad Bagher Ghalibaf (@mb_ghalibaf) Date of Tweet
In response to escalating tensions, Goldman Sachs recently raised its price forecasts for Brent and WTI crude. The investment bank warned that Brent could exceed $120 a barrel in 2027 if crude oil output in the Gulf remains significantly below pre-war levels. Goldman Sachs anticipates that shipping disruptions in the Middle East will persist into 2027, attributing this outlook to the ongoing conflict and increased market pricing of a prolonged regional instability. Meanwhile, former President Donald Trump commented on social media, predicting a precipitous drop in oil prices upon a U.S. victory in the conflict with Iran.
The interactive chart below shows the recent performance of Brent crude futures:
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