Following a report that Trump will be briefed on new Iran alternatives, oil prices surge to their highest level since 2022.
Following a rumor that the US military will brief President Donald Trump on new plans for possible action in the Iran war, oil prices have surged to their highest level since 2022.
According to news site Axios, US Central Command has drafted a plan for a series of "short and forceful" strikes on Iran in an attempt to break the impasse in talks with Tehran. The White House and US Central Command have been contacted by the BBC for comment.
At one time, Brent crude reached its highest price since Russia's full-scale invasion of Ukraine, rising by about 7% to above $126 (£94) per barrel.
Since the crucial Strait of Hormuz waterway is still essentially closed and peace negotiations seem to have stagnated, energy prices have increased this week.
According to anonymous sources mentioned in the Axios story, infrastructure targets would probably be part of the planned wave of strikes.
According to Axios, another plan called for occupying a portion of the Strait of Hormuz in order to reopen it for commercial shipping. This could entail the deployment of troops on the ground.
West Texas Intermediate crude oil, which is traded in the US, increased by 2.3% to about $109 per barrel.
On Thursday, the existing Brent futures contract for June delivery is set to expire. In morning trading in Asia, the more active July contract was up around 2% at $113.
Agreements to purchase or sell an item at a specific date are known as futures contracts.
Yeow Hwee Chua, a professor of economics at Nanyang Technological University, stated that oil dealers had responded swiftly to the prospect of additional military action in the Gulf.
He noted that even a little possibility of the conflict being worse may have "outsized ramifications" for the world's energy supplies.
The US threatened to seriously disrupt international energy shipments by blocking Iranian ports for as long as Tehran continues to threaten ships attempting to use the Strait of Hormuz.
Iran threatened to attack ships in the strait, which typically carries a fifth of the world's energy, in retaliation for US-Israeli bombings.
Following rumors that Washington was getting ready for a "extended" blockade of Iran, oil prices increased by 6% on Wednesday.According to Naveen Das, senior oil analyst at Kpler, "it does appear like escalation in the war is back on the table, whether it be in the form of the US extending its embargo in Iran or stories and rumors that Iran may start striking again in order to get out of this bind."
Businesses and governments "start to feel a bit more anxious" when the price of oil approaches $125, he said on the BBC's Today program.Because the price increase "has a knock-on effect not only on oil, but oil-related products, inflation and practically every facet of our day-to-day lives," he continued, "we would start seeing maybe more headlines of attempting to de-escalate again."
According to the BBC, energy executives met with Trump on Tuesday to talk about methods to lessen the war's effects on American consumers, which raised market concerns of a protracted disruption to energy supply.Will Walker-Arnott, investment manager at Raymond James, told the Today show, "The main concern in my mind is how long the Trump administration can survive the economic heat."He continued, "People are really starting to worry about the inflationary impact coming through from the spike in oil prices."
