Global Crude Benchmarks Jump Over 2% Amid Escalating Middle East Tensions

Global crude benchmarks jumped over 2% on Thursday as tensions in the Middle East escalated once again, with Iran announcing that the Strait of Hormuz is “closed to all vessels.”

Tehran’s move came after the US military launched fresh strikes on multiple sites in Iran. Brent crude futures rose $2.30, or 2.47%, to $95.40 a barrel, while US West Texas Intermediate (WTI) crude gained $2.60, or 2.89%, to $92.63. US crude futures had earlier advanced by more than $3 during the trading session.

Iran's top joint military command declared the Strait of Hormuz closed to all maritime traffic, including oil tankers and commercial vessels. Iran's Islamic Revolutionary Guard Corps (IRGC) also announced that the strategic waterway would remain shut following new US strikes on Iranian territory.

"Effective immediately, due to insecurity in the region, the Strait of Hormuz is declared closed to all vessels, including oil tankers and commercial ships," the IRGC said in a post on its official Telegram, as cited by CNN. "Any vessel attempting to transit the strait will be targeted," the statement added.

The latest tensions followed another round of US military action against Iran. US Central Command said in a social media post that it was striking "multiple targets in Iran" "in response to Iran's unwarranted and continued aggression."

US President Donald Trump had earlier indicated that more attacks were imminent and warned that Tehran would "pay the price" as efforts to end the conflict remained stalled.

The latest US operation came a day after Washington launched strikes against Iran following the crash of an Army helicopter near the Strait of Hormuz, an incident Trump blamed on the Islamic Republic.

Meanwhile, tensions in the Middle East, which escalated on February 28 after the US and Israel launched joint strikes on Iran, have continued to deepen. In the aftermath of the attacks, Iran effectively shut down the strategically important Strait of Hormuz through a months-long blockade. The waterway, which typically handles around a fifth of global oil and gas shipments, has remained heavily disrupted, pushing crude prices to even beyond the $125 per barrel mark, from the earlier levels of $70.

At the same time, despite diplomatic efforts, tensions between the two nations have continued despite diplomatic efforts. Iran's United Nations envoy warned that threats would not force Tehran into negotiations.

"Iran has never negotiated under threats and pressure and will never submit to pressure or question," Ambassador Amir Saeid Iravani told the UN Security Council on Wednesday.

The ongoing conflict has also had implications for oil inventories. The US Energy Information Administration (EIA) said on Wednesday that its crude stockpiles fell by 7.2 million barrels to 426.5 million barrels in the week ended June 5.