The reopening of the Strait of Hormuz hit its most serious test yet on Tuesday when Iran attacked a Qatari liquefied natural gas tanker transiting near the waterway, and a second vessel was struck by an unidentified projectile. The incidents sent oil prices sharply higher and reaffirmed the fragility of the interim U.S.-Iran peace agreement, which the two sides are still negotiating into a permanent settlement.
The Qatari LNG tanker Al-Rekayyat was attacked while transiting near the strait, said Dr. Majed al Ansari, spokesperson for Qatar’s Ministry of Foreign Affairs. Separately, the United Kingdom Maritime Trade Operations agency reported that another tanker transiting Hormuz was apparently hit by an unidentified projectile and is believed to have suffered structural damage. The strait typically handles around a fifth of the world’s seaborne oil trade.
Prices responded immediately. Brent crude futures settled 3% higher at $74.16 a barrel, while U.S. West Texas Intermediate advanced 2.8% to $70.44. The moves accelerated after the close when the United States revoked the license that had authorized Iran to sell its oil. Brent popped 5.6% to $76.04 in after-hours trading and WTI jumped 5.4% to $72.25.
“As President Trump and the administration have repeatedly affirmed, the MOU in effect with Iran is entirely performance-based,” a U.S. official told CNBC, framing the license revocation as a direct consequence of the attacks. Washington and Tehran signed the memorandum of understanding last month to bring their nearly four-month war to an end, and the license had been part of the economic incentives extended to Iran under that framework.
The escalation reintroduces a supply risk the market had largely written off in recent weeks as Gulf exports recovered and prices drifted toward pre-war levels. Analysts cautioned against assuming the worst, however. “The situation around the Strait of Hormuz remains unsettled. But as we have argued since March, both sides should ultimately have an interest in containing the conflict,” Holger Schmieding, chief economist at Berenberg, wrote in a research note.
For now, the market is left balancing two opposing forces: a security risk that has abruptly re-rated higher, and an underlying supply picture that remains firmly bearish after OPEC+ approved a fresh quota increase and Saudi Aramco cut its Arab Light price to Asian buyers. How those forces resolve will depend on whether Tuesday’s attacks prove to be an isolated flare-up or the start of a broader breakdown in the fragile peace.
Continuing coverage: Geopolitics · Qatar · Iran · Oil Prices.