Oil prices rose past $100 a barrel on Wednesday after an overnight escalation in the conflict between the US and Iran.
In back and forth attacks, the US hit five Iranian tankers in reprisal strikes after Tehran targeted one of its warships.
Brent crude – which is the global benchmark for prices – has not been as expensive since the end of July, when a ceasefire between Iran and the US collapsed.
It did dip back down to $99.90 a barrel, but any fresh flare-ups in the Middle East could see it pushed higher again.
The US strikes on the five Iranian tankers saw four in the Gulf of Oman linked to Iran’s Revolutionary Guards Corps (IRGC) hit as well as another near Kharg Island.
Tehran responded by launching missiles at a US base in Jordan – most of which were shot down – and said it attacked two US vessels and eight oil tankers in the Strait of Hormuz.
Oil prices have fluctuated wildly during the war, which started on 28 February this year.
Before the conflict Brent crude had been priced at about $70 (£52) a barrel.
But the war saw the effective closure of the Strait of Hormuz, which carries 20% of the world’s oil and liquefied natural gas (LNG).
The rising costs have sparked huge price leaps in petrol around the world for motorists at the pumps.
Tit-for-tat strikes between Iran and the US have escalated in the past week, more than six months after the US and Israel launched attacks on Iran on 28 February..
Jordan said it had shot down 18 of the 20 Iranian missiles, while two of them fell in unpopulated areas, an official spokesperson for the Jordanian Armed Forces said.
After warning of further retaliatory strikes, Iran’s Revolutionary Guards said on Wednesday they had attacked two US vessels, eight oil tankers and 10 “non-compliant vessels” trying to pass through the Strait of Hormuz, state media reported.
The latest round of escalation comes after Iran targeted a US warship with ballistic missiles, which Centcom said were “successfully evaded”. It added that no American troops were harmed during the attacks.
In response, the US said that the five Iranian oil tankers it targeted were “part of a multi-billion-dollar shadow network that funds the IRGC and its regional proxies”.
One of the ships it had struck, the M/T Riesco, sunk in the Gulf of Oman, Centcom later said, posting a video on X of the damaged vessel.
Kharg Island – where one Iranian tanker was attacked in the latest round of US strikes – hosts Iran’s main terminal for exporting oil.
Some 90% of the country’s crude oil passes through the island in the Gulf, transported through pipes from the mainland.
Pressure on oil prices has been exacerbated by wider regional instability.
Also on Tuesday, Yemen’s Iran-backed Houthi movement attacked energy facilities and civilian infrastructure in Saudi Arabia, injuring 73 people, according to Saudi authorities.
The drone and missile attack caused fires at oil facilities and installations that led to a temporary halt in operations, Saudi Arabia’s military and energy ministry said.
