Oil prices rose in Asian trade on Monday after U.S. forces struck two Iranian launchers on Larak Island, reviving fears of further disruptions to energy flows through the Strait of Hormuz.

As of 20:07 ET (00:07 GMT), Brent Oil Futures expiring in November rose 1.7% to $89.62 per barrel, while West Texas Intermediate (WTI) crude futures gained 1.6% to $84.69 per barrel.

The gains followed a U.S. military operation on Sunday against two Iranian launchers on Larak Island, located near the Strait of Hormuz, marking the first known American strikes on Iran since late July.

A U.S. official reportedly said Islamic Revolutionary Guard Corps forces had been observed preparing to launch rockets carrying sea mines into the strategic waterway.

Iran also launched missiles at U.S. forces stationed in Jordan in an apparent retaliation for the Larak Island strikes, according to a Fox News report citing a U.S. source. The report said nearly all incoming missiles had been intercepted and there had been no significant impact so far.

The latest escalation renewed concerns over supply security in the Middle East, where months of conflict have severely disrupted shipping through the Strait of Hormuz, one of the world’s the waterway normally carries roughly a fifth of global oil supplies.

Shipping traffic has already been significantly reduced by persistent attacks and security risks, with reports over the weekend showing vessel crossings falling to just a handful per day.

Oil markets have remained highly sensitive to developments surrounding the Middle East conflict this year, with Brent repeatedly swinging on shifting expectations for military escalation, ceasefire negotiations and the prospects for a sustained recovery in shipping through Hormuz.

Earlier this month, doubts over progress toward a U.S.-Iran peace agreement pushed Brent to its highest closing level since late July as Iran maintained that the strait would remain closed unless Washington changed its approach.

Attention will also remain on broader supply developments after U.S. President Donald Trump said on Sunday that Washington would begin replenishing the Strategic Petroleum Reserve using oil obtained under a new agreement with Venezuela.

Source: Investing.com

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