New US strikes against Islamic Revolutionary Guard Corps (IRGC) targets in Iran, together with the exchange of military attacks between Washington and Tehran, have revived fears of a broader escalation in the Middle East.
As a result, crude oil prices surged on Tuesday to a five-week high, amid renewed concerns about global energy flows through the Strait of Hormuz.
Brent futures rose by $4.16, or 4.6%, to close at $94.65 per barrel, while US West Texas Intermediate (WTI) crude climbed $4.46, or 5.2%, to $90.22 per barrel. Both reached their highest levels since July, as markets priced in increased geopolitical risk and the possibility of further disruptions to one of the world’s most important oil-shipping routes.
Meanwhile, the price of natural gas in Europe rose by approximately 6.20% today, reaching its highest level in three and a half years amid the escalation of hostilities between the US and Iran.
At around 10 p.m. Greek time, the TTF futures contract, considered Europe’s benchmark gas price, was up 6.20% at €74.14 per megawatt-hour, reaching its highest level since January 2023.
The rise in oil and natural gas prices came after the US Central Command (CENTCOM) confirmed that American forces had carried out strikes against Islamic Revolutionary Guard Corps targets in Iran.
According to the US side, the operations followed recent attempted IRGC attacks against commercial vessels in the Strait of Hormuz, as well as attacks against US personnel stationed in the region.
At the same time, an oil tanker was attacked by three unidentified projectiles while transiting the Strait of Hormuz on Monday, according to a report by the United Kingdom Maritime Trade Operations (UKMTO) center. The vessel was traveling through the southern shipping lane near the coast of Oman. No injuries were reported.
The attack followed an Iranian strike on two US bases in Jordan, carried out in retaliation for a US attack on Larak Island in Iran. US forces had targeted two Iranian missile launchers on the island, with reports indicating that three people were killed.
Larak, located in the Strait of Hormuz, is a strategically important military and maritime control point for Iran, as it allows Tehran to monitor shipping activity along one of the world’s most important maritime routes.
Iranian President Masoud Pezeshkian said on Tuesday at the Shanghai Cooperation Organization summit that Tehran would respond immediately if Washington returned to its commitments under the interim agreement signed in June.
The latest exchange of strikes marks the first direct US-Iran military confrontation in more than a month.
Although neither side appears to be seeking a return to all-out war, both have signaled that they are prepared to respond to further attacks.
“We will hit them hard,” US President Donald Trump told Fox News, emphasizing that there “will be a response” to Iran’s attacks against US military bases in the region.
Analysts estimate that the US strike on Larak represents more of an attempt to break the deadlock than a change in strategy.
“By striking the launchers rather than broader Iranian military infrastructure, the US appears to be punishing a specific behavior rather than, at least for now, expanding its war aims,” said Ali Vaez, director of the Iran Project at the International Crisis Group.
Meanwhile, Jason Brodsky, policy director of United Against Nuclear Iran, argued that the US administration is attempting to “enforce the blockade,” further limiting Iran’s ability to lay mines in the Strait of Hormuz while simultaneously increasing economic pressure.
Washington has increased pressure on Iran’s already strained economy through secondary sanctions, targeting countries and companies that purchase Iranian oil.
US Treasury Secretary Scott Bessent said Monday, on the sidelines of the G20 finance ministers’ meeting, that Iran is “responding militarily” because the new sanctions have begun to hurt its economy.
Trump, speaking from the Oval Office, reportedly said that Iran’s financial systems, armed forces, and government structure had been significantly weakened.
“That doesn’t mean we won’t hit them to see what happens,” he said.
The war, which is now entering its seventh month, has disrupted global energy supplies and placed significant pressure on international markets.
“This is essentially a war of attrition,” Brodsky said, noting that Trump’s “unpredictable” approach is a source of concern for Tehran, which could take more aggressive military action as economic pressure intensifies.
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