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US Oil Update: Crude Gains as Middle East Conflict, Houthi Threats Stoke Supply Fears

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Crude futures advanced in midday trading on Tuesday as intensifying tit-for-tat between the US and Iran and fresh threats to key Middle Eastern energy chokepoints heightened concerns over potential supply disruptions.

Front-month West Texas Intermediate crude futures rose 2.4% to $85.25 per barrel, while Brent futures climbed by 2.3% to $91.25/bbl.

Saxo Bank strategists said that WTI settled near $83/bbl on Monday, its highest close since mid-June, after swinging through a five-dollar range.

On Monday, the US military said that it launched another round of strikes on Monday night, targeting Iranian military command centers, launch sites and air defenses, to "further degrade" Tehran's capabilities to attack ships in the Strait of Hormuz.

The tenth round of air strikes follows President Trump's vow that Iran "will pay" for killing American soldiers.

Iran, in response, said it struck two oil tankers in the strategic waterway, as well as US military assets in Bahrain, Kuwait and Jordan, according to Iranian media reports.

Kuwait said that multiple crew members were injured in Iranian strikes on a Kuwaiti tanker passing through the Hormuz on Monday night.

According to a Kuwait Ministry of Foreign Affairs' statement on Tuesday, the country renewed its demand for Iran to immediately cease its illegitimate attacks, emphasizing Kuwait's reservation of its right to take necessary measures, and holding Iran fully responsible for this aggression and its ongoing assaults against Kuwait.

The UK Maritime Trade Operations said two vessels reported being struck by unknown projectiles in and near the Strait.

Soojin Kim, research analyst at MUFG, said that risks to regional energy supplies remain elevated as attacks on vessels in the Hormuz disrupted shipping traffic, while Yemen's Houthis threatened Saudi maritime exports through the Red Sea.

Meanwhile, two tankers that loaded Saudi crude bound for China and India this week reportedly made U-turns and were headed toward the Suez. Kpler said in a post on X that the diversions could be an early indication of broader changes in tanker trade flows.

The course reversal comes a day after Yemen's Houthis threatened a maritime embargo against Saudi Arabia, warning that any further escalation by Riyadh would be met with a broader response.

On the supply front, the International Energy Agency said on Monday that it is "closely monitoring the situation in oil markets" as escalating hostilities in the Middle East increase concerns over security of supplies.

IEA executive director Fatih Birol said that markets "continue to benefit from several cushioning factors," including significant supplies from Persian Gulf producers such as Saudi Arabia and the UAE.

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US Oil Update: Crude Gains as US Launches Fresh Strikes, Red Sea Risks Stoke Supply Fears

Crude futures settled higher in after-hours trading on Monday as the US military launched another round of strikes against Iran and renewed concerns over security in the Red Sea stoked fears of a severe regional supply crunch.Front-month West Texas Intermediate crude futures rose 0.8% to $83.12 per barrel, while Brent futures climbed by 1% to $88.95/bbl.The US Central Command posted on X on Monday that a fresh wave of strikes was launched on Iran."Today [Monday] at 4 p.m. ET, U.S. forces began a new round of strikes against Iran at the Commander in Chief's direction. The strikes are designed to further degrade Iranian military capabilities used to attack commercial shipping in the Strait of Hormuz," Centcom posted on X on Monday.Earlier on Monday, Trump warned Iran that it would face a severe response for any killing of American military personnel, saying Tehran would "pay" for such actions multiple times over."Every time Iran kills an American Soldier they will pay for that killing many times over!" Trump said in a post on Truth Social.He added that he had already passed on directives to Secretary of War Pete Hegseth, Chairman of the Joint Chiefs of Staff Daniel Caine, and other military leaders.Trump's warning comes amid heightened US-Iran tensions, with regional security risks continuing to weigh on energy markets and shipping routes across the Middle East.US Central Command had bombed Iran on Sunday for the ninth consecutive night in retaliation for repeated attacks on commercial vessels transiting the Hormuz. Iran, in response, continues to attack US bases in the likes of Kuwait, Jordan, Bahrain and Iraq.On Saturday, Kuwait suffered one of its worst nights of Iranian retaliatory attacks since the Middle East conflict began, with strikes on an oil facility and a second power plant hit in as many days.Yemen's Houthi movement, in support of Iran, also declared an immediate maritime embargo against Saudi Arabia on Monday, warning that any further escalation by Riyadh would be met with a broader response.The Houthis have repeatedly threatened to close the Bab el-Mandeb Strait during the Middle East conflict. A wider conflict with the militants could jeopardize Saudi Arabia's oil exports through its East-West Pipeline, which allows crude to bypass the Strait.The US-Iran hostilities have disrupted energy flows through the Strait, with the latest data from Kpler showing that traffic remained below normal levels, with only 30 verified transits recorded between July 17 and 19.Meanwhile, Iran reportedly confirmed receiving proposals from "certain" mediators aimed at preventing further escalation of tensions with the US.Esmail Baghaei, the spokesperson of Iran's foreign ministry, said during his weekly press briefing on Monday that mediators are actively striving to prevent further escalation and have conveyed proposals to Tehran, but he did not give further details.On the fundamentals side, Gelber & Associates said that after reclaiming the $80/bbl level, crude is beginning to shift from a purely macro-driven trade toward one increasingly influenced by tightening export availability and improving physical market signals.

Oil & Energy

US Launches Fresh Strikes on Iran as Hormuz Traffic Remains Limited Amid Houthi Threat to Saudi Arabia

The US launched a fresh round of strikes against Iran on Monday aimed at degrading Tehran's military capabilities, as heightened security risks continued to constrain commercial shipping through the Strait of Hormuz and disrupt energy flows."Today [Monday] at 4 pm ET, US forces began a new round of strikes against Iran at the Commander in Chief's direction," the US Central Command said in a post on X, adding tha the were aimed "to further degrade Iranian military capabilities used to attack commercial shipping in the Strait of Hormuz."The attacks come as the US military said it had carried out a ninth consecutive night of strikes against Iranian military targets on Sunday.US Centcom said forces conducted strikes against Iranian military command centres, air defence systems, coastal surveillance sites, maritime capabilities, missile and drone launch positions, and communications infrastructure.Meanwhile, the latest data from MarineTraffic, Kpler's ship tracking platform, showed Strait of Hormuz crossings were "limited over the weekend," with 30 verified crossings reported between Friday and Sunday.The latest daily Strait of Hormuz activity included five "entered" Middle East Gulf movements or inbound flows and three "exited" MEG movements signifying outbound flows, according to MarineTraffic.It also highlighted continued fragmentation in route selection by ships, suggesting operators remain cautious despite the absence of any sustained recovery in traffic.Of the total, 13 crossings used the Iranian Unilateral Scheme, 14 used undetermined routes and two used Omani Territorial Waters Passage, while one used the Hormuz Traffic Separation Scheme, also known as the International Maritime Organization route, according to MarineTraffic data.The latest data from Sunday included one sanctioned vessel, and two shadow fleet crossings.Additionally, MarineTraffic also reported that Bab el-Mandeb traffic remained "materially higher" as of Sunday.A total of 209 verified crossings were reported from July 15-19 July and 42 crossings on Sunday. Of the total 42, there was just one dark transit recorded, while the rest were all traceable.On Sunday, traffic was broadly balanced, with 20 vessels entering the Red Sea and 22 exiting, data showed.Yemen's Houthis on Monday declared an immediate maritime embargo against Saudi Arabia, warning that any further escalation by Saudi Arabia would be met with a broader response.The Houthis have repeatedly threatened to close the Bab el-Mandeb Strait during the Middle East conflict.The IMO's daily Strait of Hormuz incident tracker showed a total of six confirmed incidents between July 13 and July 19. These incidents bring the total number of confirmed maritime security incidents in the region to 59 as of Monday.The IMO tracker provides a daily log of verified strikes on ships attempting to transit the Strait of Hormuz since the conflict began, with the earliest incident recorded on March 1.The security situation deteriorated again after the United Kingdom Maritime Trade Operations reported an incident about 8 nautical miles northwest of Kumzar, Oman.UKMTO initially said military authorities had reported a vessel on fire before later reclassifying the incident as an attack. The maritime security agency said the ship was struck by an unidentified projectile.

Oil & Energy

Market Chatter: US, Saudi Arabia Discuss Potential Action Against Houthis

US President Donald Trump and Saudi Crown Prince Mohammed bin Salman spoke Friday as Riyadh sought to coordinate with Washington ahead of any potential action against the Houthis in Yemen, Al-Jazeera reported Monday.The discussions likely focused on the level of US diplomatic backing, and possibly military support, Saudi Arabia could expect if it moved against the Houthis.Responding to an inquiry from, a US official did not confirm nor deny the reported talks. "The United States has defensive security commitments to our partners. We will always fulfill those commitments," the official said.Saudi Arabia's Ministry of Foreign Affairs did not immediately reply to' inquiry for comment.(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)