Oil Prices Rise on Tit-for-Tat US, Iranian Strikes
Oil prices increased in the global commodity market on Monday as Middle East peace remains fragile following a tit-for-tat US and Iranian strikes over the weekend.
Brent crude futures rose 52 cents, or 0.67%, to $72.51 a barrel. US West Texas Intermediate (WTI) crude increased by 71 cents, or 1.03%, to $69.94 a barrel during early Monday
American forces carried out additional strikes against multiple targets in Iran after Tehran’s latest attack on a commercial ship near the Strait of Hormuz, the US military’s Central Command (CENTCOM) confirmed Saturday.
CENTCOM said its forces conducted the strikes June 27 “at the Commander in Chief’s direction.”
It said the strikes came after Iranian forces launched a one-way attack drone that hit the M/T Kiku at 4.30 am ET (0830GMT) while the Panama-flagged tanker was transiting near the Strait of Hormuz with more than 2 million barrels of crude oil.
CENTCOM said Iran had been given a chance to honour a ceasefire agreement after US strikes the previous day in response to an Iranian attack on the M/V Ever Lovely, but “elected not to.”
“CENTCOM forces launched strikes today in direct response to continued Iranian aggression against commercial shipping,” it said.
US military aircraft targeted Iranian military surveillance infrastructure, communication systems, air defense sites, drone storage facilities and minelayer capabilities, it added.
The command said commercial vessel transits through the Strait of Hormuz continue, and that US forces “remain vigilant, lethal, and ready.”
US-based news outlet Axios had earlier reported, citing a US official, that the American military is conducting strikes on Iranian targets in the area of the Strait of Hormuz in retaliation for an Iranian attack on a commercial tanker.
Fox News, citing a senior US defense official, said Iran had reconstituted its air defense and missile systems along the Strait of Hormuz after the US bombing campaign ended April 7.
The official said that was why the US military had to restrike areas such as Qeshm Island and Sirik, which had been targeted in the past, according to the report.
“In the time since the ceasefire on 7 April, Iran has reconstituted — thus the targets around the Strait of Hormuz,” the official was quoted. “There is a LOT that is damaged … a LOT … but they moved things around.”
LAS T WEEK
Commodity markets continued their recent decline last week, with most major commodities ending in negative territory. A stronger U.S. dollar and expectations of prolonged higher interest rates remained the dominant themes, weighing on investor sentiment.
The sell-off intensified after the Federal Reserve’s latest policy meeting reaffirmed that policymakers remain focused on bringing inflation back to target. The hawkish tone pushed precious and industrial metals to multi-week lows, while the U.S. Dollar Index climbed to a 13-month high.
Persistent inflation and resilient U.S. economic data have strengthened expectations that interest rates could remain elevated for an extended period, with markets even pricing in the possibility of another rate hike later this year.
A stronger dollar has made dollar-denominated commodities more expensive for overseas buyers, increasing price pressure.
Spot gold ended the week down 1.61% at $4,088 per ounce, while silver tumbled 8.86% to $59.15 per ounce. The near-term outlook for precious metals remains weak, with selling pressure likely to re-emerge on any recovery toward resistance levels.
Crude oil posted its steepest weekly decline in several months, with WTI crude falling to a fresh four-month low. The sharp drop was driven by the rapid
