Oil prices surge to one month high after US announces wider naval blockade on Iran

Global oil prices jumped more than nine percent on Monday after the United States announced that it would expand its naval blockade around Iran, raising fresh concerns about energy supplies moving through the Strait of Hormuz. The latest developments have increased fears of disruption in one of the world’s most important oil shipping routes, pushing crude prices to their highest level in a month.

Brent crude closed at 83.30 dollars per barrel after gaining 7.29 dollars during the trading session. US West Texas Intermediate crude settled at 78.14 dollars per barrel, rising by 6.73 dollars. Both benchmarks recorded their strongest single day gains in several months as traders reacted to growing geopolitical tensions in the Middle East.

According to the US Navy led Joint Maritime Information Center, the naval blockade is scheduled to take effect on Tuesday. Unlike previous restrictions, the new measures will apply to Iran’s entire coastline, including its ports and oil terminals. The blockade will also cover all vessels regardless of the country under whose flag they operate. The restrictions had previously been lifted in June following a temporary easing of tensions.

President Donald Trump also announced that the United States would collect a 20 percent fee on cargo transported through the Strait of Hormuz as part of the operation. The decision follows renewed military exchanges between Washington and Tehran and has added to uncertainty surrounding the future of global energy supplies.

Market analysts said the latest announcement has significantly increased concerns over the availability of oil in the coming weeks. Experts believe that reduced shipping activity through the Strait of Hormuz could tighten global supplies and keep prices elevated if tensions continue.

Iran responded by warning that it would not allow foreign powers to interfere in the management of the strategic waterway. Senior Iranian military officials said any attempt by the United States to move through the area without Iranian approval would be challenged. Meanwhile, the United Nations shipping agency opposed the proposed cargo fee, stating that there is no legal basis under international law for imposing mandatory charges on ships using international straits.

Before the conflict escalated earlier this year, nearly one fifth of the world’s daily oil and liquefied natural gas shipments passed through the Strait of Hormuz. Although shipping activity recovered slightly after a temporary ceasefire in June, traffic has slowed once again as tensions between the two countries have intensified.

Analysts believe the current situation could encourage oil producing countries to invest in alternative export routes that avoid the Strait of Hormuz. Goldman Sachs estimates that planned pipeline expansions across the Middle East could allow more than 60 percent of Gulf oil exports to bypass the waterway by the end of 2028, reducing dependence on the route during future crises.

Energy markets are also facing pressure from developments outside the Middle East. Ukraine said it carried out new strikes on Russian oil facilities as part of efforts to disrupt Moscow’s energy sector. At the same time, Kazakhstan’s main oil export pipeline reported lower shipments because of maintenance work and reduced Russian flows.

In the United States, government data showed that crude oil reserves in the Strategic Petroleum Reserve fell by around three million barrels last week, leaving stockpiles at their lowest level since 1983. The decline is part of an earlier plan to release emergency oil supplies into the market.

With geopolitical tensions rising and concerns over supply disruptions growing, energy markets are expected to remain highly volatile in the coming weeks as governments and investors closely monitor developments in the Middle East.