Oil prices jump more than 4% amid renewed US-Iran strikes

Oil prices rose more than 4% on July 13 as renewed military strikes by the United States and Iran heightened concerns over energy shipments through the Strait of Hormuz, a key global oil transit route.

Brent crude futures gained $3.10, or 4.08%, to $79.11 a barrel by 0325 GMT, while U.S. West Texas Intermediate crude climbed $2.95, or 4.11%, to $74.36 a barrel, Reuters reports.

The price increase followed another round of U.S. strikes against Iran. U.S. Central Command said its forces had struck dozens of targets across multiple locations using precision-guided munitions. Iran's Islamic Revolutionary Guard Corps said on July 13 that it had retaliated by attacking U.S. military bases in Kuwait and Bahrain.

The latest escalation has renewed uncertainty over shipping through the Strait of Hormuz. U.S. President Donald Trump said on July 12 that the waterway remained open to commercial traffic, while Iran had earlier declared the strait closed after a vessel travelling on what it described as an unapproved route was struck.

Before the conflict began at the end of February, around 20% of the world's oil and liquefied natural gas passed through the Strait of Hormuz. According to ship-tracking firm Kpler, only six vessels transited the strait on July 12, the lowest daily figure in five weeks.

The renewed hostilities have also cast doubt on the future of an interim agreement reached between Washington and Tehran last month, which aimed to reopen the strait and end the conflict after a further 60 days of negotiations.

According to the International Energy Agency, global oil supply increased by 4.1 million barrels per day in June following the agreement, but remained 9.4 million barrels per day below pre-war levels.

"Hopes of a relatively quick resolution to the recent skirmishes may be in doubt after tension escalated over the weekend," ANZ analysts said in a note.

IG market analyst Tony Sycamore said the moderate rise in oil prices suggested investors were not yet pricing in a complete breakdown of the ceasefire.

"The relatively tame rise in oil prices suggested the market was taking the view that the current flare-up represented an escalation within a fragile truce and fell well short of a complete collapse of the ceasefire."

"How accurate that view is remains to be seen," he said in a note.

By Sabina Mammadli