Oil prices skyrocketed, the US and Iran attacked each other, and the transit status of the Strait of Hormuz fell into rasheng

The Zhitong Finance App learned that due to another attack on each other by the US and Iran, the two sides have different opinions on whether the Strait of Hormuz is still open to shipping, and international oil prices rose on Monday. Benchmark Brent crude oil rose above $78 per barrel, with a cumulative increase of 5.4% last week; WTI crude oil traded around $74, and European gas futures also rose 2.7% at one point. The Iranian side claimed that the strait was “closed indefinitely from now on” — but the US Central Command immediately denied it and said that its forces had launched more attacks to ensure freedom of navigation on the waterway.

The attack on Sunday afternoon was the fourth time in a week that the US has taken action. The Central Command said the move was in response to Iran's attack on a Cypriot container ship. According to reports, the Islamic Revolutionary Guard Corps of Iran once again opened fire on the merchant ship, and the US military aircraft intercepted an Iranian cruise missile and an attack drone.

Geographic uncertainty has re-injected a risk premium into oil prices. Earlier, a temporary peace agreement between the US and Iran once made the market look forward to more supply in the Persian Gulf, and oil prices returned to the increase. The International Energy Agency (IEA) warned on Friday that the current escalation of the conflict could hamper efforts to rebuild the world's depleted oil stocks later this year — a reminder to the market that if confrontation continues, the global economy will face significant risks.

There were almost no ships passing through the strait last Sunday — the main channel usually carries about one-fifth of the world's crude oil and liquefied natural gas supplies. Only two finished tankers have been observed approaching this main thoroughfare. Despite this, the Joint Maritime Information Center said that the southern waterway coordinated by Oman is still passable.

Recent developments have also made the future of diplomacy bleak. Iran's parliament speaker and chief nuclear negotiator Ghalibaf declared that “the era of unilateral deals is over,” and Tehran insisted that the US must first fulfill its existing promises regarding the passage through Hormuz and the normalization of Iran's oil exports before negotiations can be resumed. Meanwhile, US President Trump announced that the cease-fire was “over,” but said the US side is still willing to continue negotiations.

Iranian media reported that explosions were heard in the coastal area of Qeshm Island east of Bandar Abbas (near the strait). The Islamic Republic of Iran has launched retaliatory drone and missile attacks against several US allies in the Middle East, including Kuwait, Jordan, and Qatar. Up to now, only minor damage has been reported, with no injuries.

Over the past month, the UAE and other Persian Gulf oil producers have stepped up their marketing efforts for additional crude oil after the temporary agreement mitigated export concerns. Among them, the UAE is particularly active, successfully transporting large quantities of crude oil with shuttle tankers (or “dark ships”) with shut-off transponders.