Oil Prices Hit Three-Week High as U.S.-Iran Tensions Escalate Over Strait of Hormuz

TLDR

Brent crude rose to $91.50 and WTI climbed to $85.22, hitting three-week highs Trump refused to extend the Iran ceasefire that expired Monday, sending prices higher A vessel was struck by a projectile in the Strait of Hormuz, according to UK maritime authorities Iran detained a UAE-linked tanker for allegedly violating transit rules in Hormuz Commercial shipping through Hormuz remains at a fraction of pre-war levels

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Oil prices climbed to their highest levels in nearly three weeks on Tuesday as tensions between the U.S. and Iran showed no sign of easing in the Strait of Hormuz.

Brent crude futures rose 0.7% to $91.50 a barrel. West Texas Intermediate crude gained 0.85% to reach $85.22 a barrel. Both contracts were at their strongest levels since July 30.

Brent Crude Oil Last Day Financial Futures (BZ=F)

The moves came after President Donald Trump said the U.S. would not extend a ceasefire with Iran. That agreement was signed in mid-June and expired on Monday.

Trump also repeated his claim that the U.S. holds full control over the Strait of Hormuz. Iran has denied this.

Tanker Seizure and Shipping Incident Add to Pressure

Prices got another push higher after the UK Maritime Trade Operations authority reported that a vessel was struck by an unknown projectile while transiting outbound through Hormuz.

🇺🇸🇮🇷 Trump can declare Hormuz American territory tomorrow, and not one tanker captain will care…

Words are cheap here. What actually decides who moves through that water is whether an insurer writes the policy, whether a crew agrees to sail, and whether Iranian anti-ship… pic.twitter.com/VMEZEofGnc

— Mario Nawfal (@MarioNawfal) August 18, 2026

Iranian state-linked media reported separately that Tehran had detained a tanker connected to the UAE. Iran said the vessel violated its rules in the waterway.

State-linked outlet Fars News Agency posted on X that the tanker “has been detained,” citing Iran’s policy of requiring shipowners to pay transit fees when passing through Hormuz. The vessel’s name and cargo were not confirmed.

Brent crude ended the previous session at $90.87, a gain of 2.7%, after the tanker seizure report first circulated.

Oil prices have swung sharply during the conflict based on information from both Washington and Tehran, some of which has been misleading. Iran has taken a harder line in recent weeks, striking several tankers attempting to cross the strait.

Trump Threatens Oman as Talks Stall

Trump also threatened to “bomb the s*** out of” Oman if it “gets in the way.” The comment came as Iran and Oman signaled they were in talks about reopening shipping routes through Hormuz.

BREAKING: President Trump threatens to bomb Oman if they "get in the way" of US efforts to reopen the Strait of Hormuz and end the war with Iran.

"If Oman gets in the way, we'll bomb the s*** out of them," President Trump said.

— The Kobeissi Letter (@KobeissiLetter) August 17, 2026

No definitive agreement has been announced by either country.

Commercial traffic through Hormuz remains well below pre-war levels. Fears of Iranian attacks have discouraged ships from attempting the crossing.

Before the conflict, the Strait of Hormuz carried roughly 20% of global oil supplies. Its closure has sharply reduced crude availability on world markets.

Talks between the U.S. and Iran are described as ongoing by Washington. Tehran has disputed that characterization.

The market is watching for any development in the Oman-Iran shipping talks, which could potentially ease supply constraints if a deal is reached.

For now, traders are pricing in continued disruption with little sign of a near-term resolution.

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