Oil Prices Surge Amid Escalating US-Iran Conflict

Oil prices rose approximately 6% on Sunday evening following renewed escalation in the U.S.-Iran conflict, reversing much of the sharp decline seen earlier in the week when officials suggested the Strait of Hormuz might reopen to tanker traffic.

The global benchmark Brent crude climbed to $95.42 per barrel, while West Texas Intermediate (WTI), the primary U.S. Reference, reached $89.77, according to market data reported by Axios and sourced from Financial Modeling Prep.

The price increase came after American forces seized an Iranian-flagged cargo ship in the Gulf of Oman on Sunday, which President Donald Trump said had attempted to bypass a U.S. Naval blockade. This marked the first vessel seizure and the first instance of firing since the blockade began the previous Sunday.

Iran responded by declaring the Strait of Hormuz closed to traffic on Saturday, reversing earlier statements from Friday when both Trump and Iran’s foreign minister had suggested the waterway was opening. Analysts had already questioned whether those assurances were sufficient to restore confidence among shipping companies.

Energy Secretary Chris Wright said on Sunday that U.S. Gasoline prices may not fall below $3 per gallon until next year, though he added that prices have likely peaked and would decline with a resolution to the conflict. He described a return to sub-$3 prices as “pretty tremendous” in inflation-adjusted terms and argued the Trump administration had managed the disruption effectively.

According to AAA data cited in the report, U.S. Gasoline prices reached a yearly high of $4.16 per gallon earlier in April before easing to $4.05. Wright noted this year’s peak remains about $1 below the 2022 high of approximately $5.02 per gallon under the Biden administration.

Vice President JD Vance is set to lead a U.S. Delegation in talks with Iran in Islamabad before the current ceasefire expires on Tuesday night. The discussions, described by two U.S. Officials as a potential “eleventh hour” opportunity, aim to either reach a deal or extend the ceasefire, though Iran has not confirmed participation and suspects the talks may be a cover for a U.S. Surprise attack.

Market analysts continue to emphasize that prolonged disruption to oil transit through the Strait of Hormuz will keep crude prices elevated, affecting U.S. Consumers despite the country’s status as the world’s largest oil producer due to its deep integration into global energy markets.