Oil Price Today: WTI Tops $90 as US-Iran Strikes Raise Hormuz Supply Risks

Key Takeaways

• WTI crude settled 5.2% higher at $90.22 on Tuesday, September 1, while Brent gained 4.6% to $94.65.
• Oil extended its advance during Wednesday’s Asian session, with WTI moving above $91 and Brent approaching $97.
• Renewed US strikes on Iranian military targets intensified concerns about prolonged disruption to energy shipments through the Strait of Hormuz.

Oil Prices Reach Five-Week Highs

Oil prices surged on Tuesday as renewed military action between the United States and Iran increased fears of further disruption to Middle Eastern energy supplies.

West Texas Intermediate crude futures climbed $4.46, or 5.2%, to settle at $90.22 per barrel. Brent Crude advanced $4.16, or 4.6%, to $94.65. The session produced the highest closing levels for both benchmarks in approximately five weeks.

The rally continued during Asian trading on Wednesday, September 2. WTI moved above $91 per barrel, while Brent rose beyond $96 and briefly approached $97. The move showed that traders were continuing to add a geopolitical risk premium after the latest escalation.

The gains also represented a sharp reversal from the softer demand-driven trading conditions seen earlier in the summer. Immediate supply security has again become the dominant factor influencing crude oil prices.

US Launches New Strikes Against Iranian Targets

US forces completed a fresh wave of strikes against Islamic Revolutionary Guard Corps targets in Iran on September 1. The targets included air-defence sites, radar systems, maritime facilities, mine-laying capabilities and communications infrastructure.

The strikes followed attempted attacks against commercial vessels in the Strait of Hormuz and US military personnel deployed in the region. More than 50,000 US service members remain stationed across the Middle East.

The latest operation reduced expectations that the previous exchange of fire would remain contained. Instead, the renewed attacks raised the possibility of a longer period of military confrontation involving shipping routes, energy infrastructure and Gulf export facilities.

This uncertainty is especially important for oil markets because traders must price not only confirmed supply losses but also the probability of future disruption. Even when physical cargo continues moving, higher insurance costs, Shipping delays and reduced tanker availability can increase the effective cost of transporting oil.

Why the Strait of Hormuz Matters to Oil Markets

The Strait of Hormuz connects the Persian Gulf with the Gulf of Oman and the Arabian Sea. It remains one of the world’s most important energy transit routes.

Around 20 million barrels per day of oil passed through the strait in 2024, equivalent to roughly 20% of global petroleum liquids consumption. The route also handled more than one-quarter of global seaborne oil trade and approximately one-fifth of worldwide liquefied natural gas trade.

These volumes explain why even a partial disruption can generate a substantial market reaction. Iran, Saudi Arabia, Iraq, Kuwait, Qatar and the United Arab Emirates all rely on the Persian Gulf shipping system to varying degrees.

Alternative pipelines can reduce some of the pressure, but they cannot fully replace the strait. Saudi Arabia and the UAE have an estimated 2.6 million barrels per day of spare pipeline capacity that could bypass Hormuz during a disruption. That represents only a fraction of the oil normally transported through the waterway.

Asian markets would face the greatest direct exposure. About 84% of crude oil and condensate shipments moving through Hormuz went to Asia in 2024. China, India, Japan and South Korea collectively received approximately 69% of the route’s crude and condensate flows.

A prolonged interruption could therefore increase import costs for major Asian economies, weaken trade balances and add pressure to regional currencies.

Supply Fears Push Inflation Risks Higher

The oil rally has implications beyond the energy market. Higher crude prices can raise transport, manufacturing and agricultural costs, potentially slowing progress on inflation.

Government bond yields have already moved higher as traders assess whether rising energy prices could keep central banks restrictive for longer. A sustained period with WTI above $90 and Brent close to $100 would strengthen concerns that headline inflation may reaccelerate.

The effect would depend on how long prices remain elevated. A brief geopolitical spike may have a limited impact on consumer inflation, particularly if the conflict de-escalates quickly. A prolonged disruption affecting crude oil, diesel and other refined products would present a greater challenge.

Diesel markets are particularly sensitive because refinery disruptions in the Middle East and Russia have tightened supplies. Higher diesel costs can spread through freight, construction, mining and food-production chains more quickly than changes in crude prices alone.

Energy-importing countries may experience the greatest pressure, while producers could benefit from stronger export revenue. However, unusually high oil prices can eventually weaken global demand and slow economic activity, creating a counterweight to the initial supply-driven rally.

Could Brent Crude Reach $100?

Brent is now within relatively close reach of the psychologically important $100 level. A move from $95 to $100 would require an increase of slightly more than 5%, which is possible during periods of severe geopolitical volatility.

A sustained advance would probably require evidence that the conflict is materially reducing exports, limiting tanker movements or damaging energy infrastructure. Further attacks near the Strait of Hormuz could also push shipping and insurance costs higher.

However, a test of $100 is not guaranteed. Signs of diplomatic progress, improved vessel traffic or the use of alternative export routes could remove part of the risk premium. Additional production from suppliers outside the immediate conflict zone could also help stabilise the market.

The strength of the US dollar remains another factor. Oil is priced in dollars, so a stronger dollar can make crude more expensive for buyers using other currencies and may eventually restrain demand.

What to Watch Next

The security situation around the Strait of Hormuz remains the most important short-term driver. Traders will be watching vessel movements, further military announcements and any evidence of damage to oil production or export infrastructure.

US inventory data will provide another test for the rally. A larger-than-expected decline in crude stocks could reinforce concerns about tightening availability, while an unexpected build may offer some evidence that domestic supply remains sufficient.

WTI’s ability to remain above $90 will be an important technical signal. Holding that level could keep attention on the recent intraday highs and the possibility of further gains. A decline back below $90 may indicate that some of the immediate geopolitical premium is fading.

For Brent, the $95–$97 region is the nearest area to monitor. A decisive break above it would bring $100 into focus, while signs of de-escalation could trigger rapid profit-taking after the latest surge.