Iran Claims Hormuz is Closed, Oil Prices Jump More than 4 Percent

JAKARTA - World oil prices jumped more than 4 percent after the United States and Iran again attacked each other. The market is increasingly restless as the two countries provide different information regarding the status of the Strait of Hormuz, the world's main energy route.

The Straits Times, citing Bloomberg, reported that Brent crude prices rose 4.1 percent to $79.14 a barrel at 0940 Singapore time. Brent had earlier gained 5.4 percent over the past week.

West Texas Intermediate crude, the benchmark for U.S. oil prices, rose 4.3 percent to $74.46 a barrel.

European natural gas prices are also being pushed. Futures rose as much as 2.7 percent after gaining nearly 8 percent last week. Markets are worried that the conflict is hampering energy shipments from producer countries in the Persian Gulf.

Iran said the Strait of Hormuz was closed "until further notice". US Central Command or Centcom denied it and said its forces were again attacking to maintain freedom of navigation in the area.

On the ground, ship traffic through Hormuz on July 13 was barely visible. The slowdown has been in place since tensions escalated last week.

The Strait of Hormuz is usually passed through about a fifth of the world's crude oil and liquefied natural gas supplies. However, the Joint Maritime Information Center said the southern shipping lane coordinated by Oman could still be used.

The July 12 attack was the fourth US military operation in a week. Centcom said the move was a response to an Iranian attack on a Cypriot-flagged container ship.

CNN reported that the Islamic Revolutionary Guard Corps fired again at commercial vessels. US aircraft were also said to have intercepted Iranian cruise missiles and attack drones.

The uncertainty has led markets to once again incorporate the risk of war into oil prices. Previously, prices had lost gains after a temporary peace deal opened up additional supply opportunities from the Persian Gulf.

The International Energy Agency on July 10 warned that new tensions could derail efforts to replenish the world's depleted oil supplies by the second half of 2026.

MST Marquee senior energy analyst Saul Kavonic said the latest escalation had not led to an open war.

"We are likely to see oil prices continue to rise slowly during the attack and shipping through the strait remains more cautious," he said.

Threats to the energy market increased after Iran launched retaliatory attacks with missiles and drones on a number of US allies in the Middle East, including Kuwait, Jordan, and Qatar.

The attack on Kuwait's oil drilling facilities was the first direct attack on energy infrastructure in weeks.

Kavonic estimated that oil prices could head to $100 a barrel if the conflict spreads and more energy facilities are targeted.

The chances of diplomacy are also shrinking. The Speaker of the Iranian Parliament and the main negotiator, Mohammad Bagher Ghalibaf, stated that "the era of unilateral agreements has ended".

Tehran asked Washington to first fulfill commitments regarding navigation in Hormuz. Iran also demanded the normalization of oil exports before negotiations continued.

US President Donald Trump said the ceasefire had "ended". However, he said Washington was still willing to continue negotiations.

Over the weekend, Iranian media reported an explosion east of Bandar Abbas, near the Strait of Hormuz.

In the past month, a number of Persian Gulf producers, including the United Arab Emirates, have offered additional crude oil after a temporary agreement had eased market concerns.

The United Arab Emirates is among the most successful producers in sending additional oil using tanker ships with transponders turned off. Transponders are devices that send the ship's identity and position.