Oil rises after false reports of Iranian strike in Hormuz
Oil futures jumped after reports Iran’s IRGC struck a U.S. warship in the Strait of Hormuz, pushing WTI to $107.28 and Brent near $114 before CENTCOM denied the attack.
Reports that Iran’s Islamic Revolutionary Guard Corps struck a U.S. warship in the Strait of Hormuz drove oil futures higher early Monday, before prices eased after U.S. military officials denied the incident.
West Texas Intermediate for June delivery spiked to $107.28 in morning trading and later settled a little above $105 a barrel. Brent for July delivery climbed close to $114 before retreating toward $110. Traders pushed prices up on the prospect that renewed clashes in the strait could disrupt shipments through a waterway that carries more than 20% of the world’s crude.
Initial accounts said two missiles hit a U.S. warship. U.S. Central Command posted that “no U.S. Navy ships have been struck” and added that U.S. forces are “supporting Project Freedom and enforcing the naval blockade on Iranian ports.” The CENTCOM statement helped calm markets after the early volatility.
The reports came after former President Donald Trump announced a U.S. Navy operation called Project Freedom to free commercial vessels stranded in the Strait of Hormuz. He described the effort on his social platform as a humanitarian mission to deliver food and supplies to crews aboard ships stuck in the passage.
Iran’s military chief, Ali Abdollahi Aliabadi, issued a warning after the April 7 truce, saying foreign armed forces, “especially the aggressive US military,” would be attacked if they attempted to enter the strait without coordinating with Iran’s armed forces. Tehran has rejected unilateral U.S. naval transit through the waterway.
Market participants cited immediate fears of shipping disruptions and a wider geopolitical risk premium when pricing oil. After CENTCOM’s denial, prices moderated, but traders said the situation remains fragile because statements from regional forces and U.S. officials have differed.
A ceasefire on April 7 briefly reduced hostilities. Competing claims over naval operations and blocking measures have left the status of commercial traffic in the area uncertain. Oil markets responded to the conflicting reports and to official statements from both sides.
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