Global Oil Prices Surge Amid Escalating US-Iran Tensions in Strait of Hormuz

New York. Crude oil prices have surged sharply in the global market. The rise in oil prices on Friday follows escalating tensions between Iran and the United States in the Strait of Hormuz. The oil market has been rattled as both nations engage in a standoff involving the targeting of vessels passing through the strait. In Friday morning trading, the international benchmark, Brent crude, surpassed $106 per barrel.

On Friday, Brent crude traded at $106.80, marking an increase of nearly 5 percent from Wednesday's closing price. On Wednesday, Brent prices had crossed the $100 mark for the first time in two weeks.

The heightened tensions have also impacted the US stock market. At Thursday's close, the S&P 500 index fell by 0.41 percent, while the Nasdaq Composite dropped by 0.89 percent. Approximately 20 percent of the world's oil and gas supply passes through the Strait of Hormuz, but the route is currently near a standstill. Iran is attempting to control vessel movement, while the US is working to block Iran's maritime trade.

US President Donald Trump stated that he has ordered the US Navy to destroy any Iranian boats that attempt to lay mines in the strait. He also warned on social media that the strait would remain completely closed unless Iran reaches an agreement. Previously, Iran's Islamic Revolutionary Guard Corps (IRGC) claimed to have seized two foreign cargo ships from Panama and Greece.

However, Greece has stated that its vessels are safe. Amid the Iran conflict, vessel traffic through this waterway has significantly declined. According to United Nations data, while approximately 129 ships typically pass through this route daily, the number has dropped drastically. On Wednesday, only eight ships passed through the Strait of Hormuz, following counts of 15 and 7 on Monday and Tuesday, respectively.