Oil approached fresh highs on US-Iran exchange of strikes

Oil prices rise for a third consecutive trading session on September 2 amid heightened concerns over supply disruptions through the Strait of Hormuz after a fresh escalation in the US-Iran conflict. Brent neared $96 a barrel, while US WTI traded near $91.

The oil market already experienced a sharp jump the day before: on Tuesday, Brent rose 4.6%. WTI ended the session up 5.2% at $90.22 a barrel, its highest level in about six weeks.

A new impetus for prices came from continued hostilities between Washington and Tehran. The US struck Iran for a second consecutive day, and President Donald Trump threatened an even larger attack if Tehran retaliated.

Hours later, Iran responded with strikes against targets in Jordan, Bahrain, and Kuwait, countries where US forces are based. For the oil market, the key risk remains the possible further spread of hostilities around the Strait of Hormuz and new attacks on shipping.

A separate factor of tension was the shift in American tactics regarding Iranian shipping. According to Axios, during the latest wave of strikes, US forces attacked two Iranian government tankers. This marked the first time the US had struck Iranian tankers in response to attacks on shipping in the Strait of Hormuz. 

A US official called these actions part of a Trump-approved "tanker for tanker" policy aimed at deterring Iran from new attacks on vessels transiting the strait. According to Axios, despite the escalation, about 40 vessels carrying millions of barrels of oil passed through Hormuz on Tuesday. The US military continues to escort ships through the strait.

Further price dynamics will depend largely on whether the current exchange of strikes develops into a longer campaign and whether it affects actual oil supply volumes from the region. For now, traders are pricing in a higher risk premium for possible transport disruptions.

Based on materials from: Bloomberg, Axios, MarketWatch