Global oil prices climbed more than 3% on Tuesday, extending gains from the previous session, as the ongoing standoff between the United States and Iran continued to disrupt energy flows through the strategically vital Strait of Hormuz. The waterway, which handles roughly a fifth of global oil and gas shipments, remains largely restricted, tightening supply expectations.
Brent crude futures for June delivery rose $3.28 to $111.51 a barrel by 1115 GMT, marking a seventh consecutive day of gains and the highest levels since early April. U.S. West Texas Intermediate (WTI) crude also climbed sharply, gaining $3.47 to trade near $100 per barrel, reflecting broad market concerns over prolonged disruptions.
The rally follows stalled diplomatic efforts, with U.S. President Donald Trump rejecting Iran’s latest proposal to end hostilities. Iranian officials, meanwhile, signaled that key issues such as their nuclear programme would only be addressed after a ceasefire and resolution of maritime disputes, leaving negotiations at an impasse.
Iran’s continued restriction of shipping through Hormuz, coupled with a U.S. blockade of Iranian ports, has effectively created a supply bottleneck. Analysts say the deadlock has forced traders to reprice geopolitical risk, with markets bracing for a prolonged period of instability in the region.
“Oil above $110 per barrel reflects a market rapidly factoring in geopolitical uncertainty,” said Jorge Leon of Rystad Energy. He added that even a partial agreement between the two sides is unlikely to fully resolve disruptions to the Strait, keeping upward pressure on prices.
Shipping data underscores the strain, showing several Iranian tankers turning back due to U.S. enforcement measures, though limited traffic persists. A Saudi crude tanker and a UAE-linked liquefied natural gas vessel were among those attempting to navigate the passage, highlighting ongoing but constrained movement through the corridor.
With peace talks having collapsed last week and no immediate breakthrough in sight, market participants expect volatility to persist. The crisis underscores the vulnerability of global energy supply chains to geopolitical flashpoints in key transit routes.