Oil extends five-day rally as threats to Strait of Hormuz and Red Sea shipping fuel supply concerns
Brent crude oil climbed above $96 per barrel on Thursday, reaching its highest level in six weeks as escalating tensions in the Middle East heightened concerns over potential disruptions to global energy supplies.
The international benchmark extended gains for a fifth consecutive trading session, driven by growing fears over the security of two of the world’s most important oil shipping routes—the Strait of Hormuz and the Red Sea.
Strait of Hormuz tensions lift oil prices
Investor sentiment deteriorated after US President Donald Trump warned that Washington would target Iranian infrastructure if Tehran attacked vessels passing through the Strait of Hormuz.
Iran responded by threatening retaliation against US-linked energy assets across the region, intensifying geopolitical uncertainty and raising concerns about the continuity of global crude exports.
Analysts said any disruption to shipping through the Strait of Hormuz, through which roughly one-fifth of global oil consumption passes, could significantly tighten international oil supplies and push prices even higher.
Red Sea attacks deepen supply concerns
Adding to market anxiety, Iran-backed Houthi militants reportedly attacked two Saudi oil tankers in the Red Sea using missiles and drones.
The incident marked the first direct attack on oil tankers in the strategic waterway, raising fresh concerns about the security of an important alternative export route for Saudi crude.
The latest developments have expanded the regional conflict, increasing the risk of disruptions across both the Red Sea and the Strait of Hormuz, two vital maritime corridors for global energy trade.
Diplomatic prospects remain uncertain
Meanwhile, US forces reportedly carried out a 12th consecutive day of strikes on Iranian targets, while officials in Washington and Tehran continued to play down the likelihood of renewed diplomatic engagement.
Market participants said the absence of meaningful diplomatic progress has reinforced expectations of prolonged geopolitical uncertainty, supporting higher oil prices.
Impact on Pakistan and global markets
The rally in Brent crude above $96 is expected to increase pressure on oil-importing economies, including Pakistan.
Higher international crude prices could raise Pakistan’s fuel import bill, widen external account pressures and contribute to higher domestic inflation through increased fuel and energy costs.
Analysts said global energy markets are likely to remain volatile in the coming days, with investors closely monitoring geopolitical developments that could further affect oil supplies and transportation through the Middle East.