Oil hits $100 a barrel as U.S. and Iran trade fresh strikes
Oil prices reached $100 a barrel on Wednesday as the United States and Iran escalated their military standoff with new attacks on shipping and missiles, heightening fears of a prolonged disruption in global energy supplies.
The spike followed a late Tuesday announcement by U.S. Central Command that its forces had destroyed five Iranian oil tankers in the Gulf of Oman and near Kharg Island, Iran’s main crude-export terminal. CENTCOM said the ships were tied to Iran’s Islamic Revolutionary Guard Corps and part of a “shadow fleet” used to generate revenue for the regime. It added that crews were directed to abandon the vessels before the strikes and released video footage of the operation.
Iranian state media said Tehran retaliated by launching missiles at U.S. targets in Jordan. Jordan’s military said its air defenses intercepted 18 ballistic missiles and that two other projectiles landed in unpopulated areas; no casualties were reported. Jordan is a key U.S. ally that hosts American forces, making it a recurring target in the standoff.
Iran’s foreign ministry condemned the U.S. attacks on its commercial tankers, calling them “an overt threat to regional and international peace and security,” and said Iranian forces had targeted U.S. military facilities in self-defense.
The Islamic Revolutionary Guard Corps threatened to hit 20 targets for every two or three U.S. strikes. IRGC spokesman Brig. Gen. Hossein Mohebi said Iran also had the capacity to strike targets at 400 kilometers, claiming his forces had previously targeted an American aircraft carrier from 500 kilometers away. He set conditions for ending the conflict, including a complete halt to attacks by Washington, the release of $24 billion in frozen Iranian assets, an end to what he called threats, the withdrawal of Israeli forces from Lebanon, an end to the blockade of Yemen and a halt to interference in Iran’s nuclear and missile programs.
The IRGC later said its naval forces had attacked two U.S. warships, eight oil tankers and 10 “non-compliant vessels” trying to transit the Strait of Hormuz, claiming to have inflicted heavy damage. CENTCOM dismissed that as “completely false,” saying no U.S. Navy vessel had been struck and all Iranian attacks had failed. The command said it had destroyed 10 Iranian tankers over the past week.
Commercial shipping has increasingly been caught in the crossfire. Several merchant vessels in the Northern Arabian Gulf and Gulf of Oman were on fire Wednesday, according to the U.K. Maritime Trade Operations center, which described the damage as “disabling fire” from military activity. The center also said a tanker anchored northwest of Port Rashid in the UAE was listing, possibly after being hit by an unknown projectile. In a separate incident, Iraq’s Oil Ministry said a tanker leased by the Iraqi Oil Tankers Company was struck by an unknown source inside Iraqi territorial waters, causing minor hull damage but no casualties or leakage.
Iran’s paramilitary force announced a new “prohibited zone” outside the Strait of Hormuz, stretching from near Chabahar into the Gulf of Oman and the Arabian Sea, and said vessels entering without coordination would be subject to Iranian sanctions. Earlier this week, Tehran said it planned an “exclusion zone” to stop ships trying to pass through the strait without its permission. The IRGC also warned crew members on tankers near Kuwait and Bahrain to leave their vessels immediately, saying they could be targeted in retaliation.
The renewed confrontation is rattling oil markets. Brent crude, the international benchmark, traded at $100 a barrel on Wednesday morning, its highest level since late July, while U.S. benchmark crude rose 1.2% to $94.17. The price surge continues an upward trend since August, as a ceasefire between Washington and Tehran collapsed after disagreements over control of the Strait of Hormuz. Before the war started in February, roughly a fifth of the world’s oil passed through the waterway; traffic has since plummeted, with only limited periods of partial recovery. Goldman Sachs analysts have said that intensified attacks in the Gulf and Red Sea could push prices above $120 a barrel, adding to fuel costs already weighing on American households.
The conflict is also reverberating in Yemen, where Iran-backed Houthi rebels accused Saudi Arabia of carrying out an airstrike on a prison in Al-Jawf province on Monday. In a statement on X, Houthi military spokesman Brig. Gen. Yahya Saree said the strike killed a large number of inmates as well as visiting women and children. Saudi Arabia did not respond. The Houthis also reported more than 30 Saudi strikes on several regions Wednesday, one day after their own attacks on Saudi oil facilities injured 73 people and caused temporary closures. Fighting in Yemen reignited last week after the Houthis launched a campaign near the Bab al-Mandab strait, a route that has grown more important for Saudi oil exports as the Strait of Hormuz has been largely shut.
In South Korea, dozens of protesters gathered in Seoul near the U.S. embassy compound, urging the government not to send troops to the Strait of Hormuz. “We cannot send our young people into a sea of death!” they chanted. South Korean defense authorities have sent a fact-finding mission but have stressed that no decision has been made on any deployment. Iran warned that a South Korean deployment would be viewed as supporting “the party responsible for that aggression” and would carry serious consequences.
The escalation underscores how quickly the region’s fragile security arrangements have unraveled since the June ceasefire fell apart. With both sides signaling they are prepared to keep responding militarily, the risk of a broader conflict that disrupts one of the world’s most vital shipping lanes is growing. Any prolonged closure of the Strait of Hormuz would likely drive energy prices even higher and complicate global supply chains, analysts say.