Crude oil prices have hit their highest levels in four weeks, as Washington and Tehran traded attacks and the US reimposed a naval blockade of Iran. Brent crude jumped $3.79 a barrel to $87.08 a barrel, a 4.55% increase, the highest since 12 June, before the ceasefire.
Ceasefire collapse and renewed tensions
The US and Iran signed a memorandum of understanding to end the conflict on 17 June and engaged in negotiations for a permanent peace deal. However, Iran said on Monday it was continuing talks with mediators from Qatar, Pakistan and Oman to try to prevent any further escalation. Donald Trump declared the ceasefire over last week but left the door to talks open.
Market reaction and price forecasts
US West Texas Intermediate crude rose to a high of $81.25 a barrel, and is now trading at $80.92 a barrel, up 2.8%. Soni Kumari, analyst at ANZ bank, told Reuters: "What we think is that the peak of the escalation is behind us, but there are upside risks to oil prices if these disruptions continue and that will keep prices in the $85-$90 range."
