Oil prices rose sharply in Asian trade on Monday amid renewed hostilities in the Middle East and the US rescinding a license allowing the sale of Iranian oil, Reuters reported, BTA reported.
Brent North Sea crude, a benchmark for Europe, rose 2 percent to $75.60 a barrel. Although prices remained well below the 120-day high reached during the US-Iran war, the rise unsettled the bond market, raising inflation risks as the six-month conflict has depleted global inventories.
West Texas Intermediate, a US benchmark for August delivery, rose 2.87 percent to $72.46 a barrel. barrel.
The US military said it had launched a "series of powerful strikes" against Iran after three merchant ships passing through the Strait of Hormuz were attacked yesterday, and warned that Tehran would face "severe consequences" for its attacks on commercial shipping.
The new escalation in tensions threatens to test a fragile truce reached last month that allowed the key sea route to reopen after months of disruption.
In a sign of the worsening situation, the US Treasury Department last night revoked a waiver that allowed Iran to sell its oil.
At least four oil and gas tankers have turned back after trying to pass through the Strait of Hormuz, shipping tracking data shows, as The renewed attacks on ships have heightened security concerns, Reuters reported.
Ships were diverted after a Qatari LNG tanker and a Saudi-flagged oil tanker were damaged yesterday after Iran reportedly fired missiles at ships in the strait, prompting maritime authorities to raise the threat level for passing ships to "severe".