Oil prices declined by approximately 1% on Thursday but remained near one-month highs as military tensions between the United States and Iran continued. Brent crude futures fell 75 cents to $84.20 a barrel, while U.S. West Texas Intermediate (WTI) futures dropped 81 cents to $78.79. The price dip followed a session high where both contracts had gained more than 1%.
The market fluctuations occurred as the U.S. military conducted strikes against Iranian coastal defenses and missile sites on Wednesday. In response, Iranian officials reportedly instructed Yemen’s Houthi movement to prepare to block the Red Sea oil export route if the U.S. targets Iranian power infrastructure. These developments follow the U.S. reimposition of a naval blockade on Iranian ports, which has already reduced vessel traffic through the Strait of Hormuz.
Market analysts noted that simultaneous disruptions in the Strait of Hormuz and the Bab el-Mandeb strait would affect a significant portion of global oil transit. However, some upward price pressure was offset by reports of increased crude loadings from Iraq and Iran’s release of a U.S. citizen, which some observers suggested could indicate an opening for de-escalation. Efforts to balance the market continue as both nations maintain heightened military readiness.