Brent crude climbs above $85 as US-Iran tensions hit Hormuz

Oil prices surged this week, posting their largest two-day gain in four months, as renewed military hostilities between the United States and Iran reignited fears of a major supply disruption in the critical Strait of Hormuz. The international benchmark, Brent crude, climbed above $85 per barrel, a one-month peak, following a series of attacks on tankers and the collapse of a short-lived ceasefire in the region.

The sharp escalation began when Iranian forces targeted tankers near the strait starting July 8, restarting a cycle of military exchanges. In response, U.S. President Donald Trump declared the ceasefire over and reinstated economic sanctions against Iran. He also announced the reinstatement of a naval blockade on Iranian ships in the Strait of Hormuz and called for a 20 percent payment on all cargo shipped through the waterway to reimburse the United States for providing protection. The strait is a vital chokepoint, with roughly 20 percent of the world's oil trade passing through it.

Over July 12 and 13, Brent crude surged 9.6 percent, while the U.S. benchmark, West Texas Intermediate, climbed 9.4 percent. By July 14, Brent pushed further to near $85.67. While prices...