Brent crude climbed to $76.18 a barrel and WTI rose to $72.46 after the US launched airstrikes on Iran and reimposed sanctions on Iranian crude sales.
The escalation follows attacks on commercial vessels in the Strait of Hormuz, reviving concerns over disruptions to a waterway that handles nearly 20% of global energy shipments.
After falling to pre-conflict levels following last month's US-Iran truce, oil prices rebounded as traders reassessed geopolitical risks and the outlook for Middle East crude supplies.
Oil prices climbed more than 2 per cent on Wednesday after the US launched military strikes against Iran and reinstated sanctions on its crude exports, fuelling fresh concerns West Asia supply disruptions and the durability of last month's ceasefire.
Brent crude futures for September delivery rose 2.75 per cent to $76.18 a barrel, while West Texas Intermediate (WTI) crude for August delivery gained 2.87 per cent to $72.46 a barrel.
1 June 2026
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Both benchmarks had already advanced nearly 3 per cent in the previous session following Washington's decision to revoke a licence that had permitted Iranian crude sales.
Ceasefire Optimism Gives Way to Renewed Tensions
Following the US-Iran ceasefire agreement signed last month, crude prices had retreated to pre-conflict levels as traders anticipated additional oil supplies from the region.
The easing of geopolitical tensions also prompted investors to build sizeable short positions in oil futures, expecting prices to decline further.
However, the latest military escalation has reversed that sentiment, with markets once again pricing in the risk of supply disruptions from one of the world's most critical energy-producing regions.
Vessel Attacks Renew Strait of Hormuz Concerns
The latest escalation follows attacks on commercial vessels transiting the Strait of Hormuz, a strategic shipping lane that carries roughly one-fifth of global energy supplies.
While Iran denied responsibility, Qatar blamed Tehran for attacks that included a drone strike on a Qatari liquefied natural gas tanker, triggering a fire in its engine room.
Separately, a Saudi-flagged crude tanker, believed to be the supertanker Wedyan, was also reportedly damaged off the coast of Oman, although the cause remains under investigation.
The incidents have reignited concerns over the safety of tanker traffic through the waterway.
US Tightens Pressure on Iran
The US Treasury Department on Tuesday withdrew the waiver that had allowed Iran to continue selling crude oil.
"Iran will only reap benefits if they exhibit good behavior,” CNBC reported citing a US official. "Iran's actions in the Strait were wholly unacceptable to the United States and will be met with consequences."
The US Central Command said the military strikes were carried out in response to Iranian attacks on three commercial vessels in the Strait of Hormuz, describing Tehran's actions as "dangerous" and a violation of the ceasefire.
Meanwhile, Iran has reportedly instructed ships to navigate closer to its coastline instead of routes nearer Oman, reinforcing its assertion of control over the strategic waterway.
Washington has reiterated that the Strait of Hormuz must remain open to international shipping, warning against any attempts to restrict maritime traffic.
