Oil futures climbed sharply Tuesday after the U.S. Treasury Department revoked, effective immediately, the license it had granted on June 21 allowing the sale of Iranian crude.
The license cancellation followed a series of attacks on commercial vessels transiting the Strait of Hormuz, a critical global energy chokepoint located between Iran and Oman.
President Donald Trump’s administration made clear the memorandum of understanding with Iran is entirely performance-based, according to a U.S. official who spoke to MarketWatch.
“Iran’s actions in the strait were wholly unacceptable to the U.S. and will be met with consequences,” the official said, adding that U.S. negotiators will continue to work in good faith toward a final deal.
The United Kingdom Maritime Trade Operations, known as UKMTO, reported that a tanker transiting the Strait of Hormuz was struck by a drone Tuesday and suffered minor structural damage.
UKMTO also reported a separate attack by an unidentified projectile on a tanker Monday, while on Sunday a cargo vessel in the region reported being under attack by unknown armed assailants.
Three vessels, including a Qatari LNG carrier and a Saudi oil tanker, were struck by projectiles while traveling in or near the Strait of Hormuz, according to UK maritime network alerts and government statements.
Iran attacked the Qatari liquefied natural gas tanker Al-Rekayyat while it transited near the strait, according to Dr. Majed al Ansari, the spokesperson for Qatar’s Ministry of Foreign Affairs.
“We demand that the Islamic Republic of Iran immediately cease all practices that undermine regional security or threaten the safety of international maritime navigation,” al Ansari said in a social media post.
Qatar’s Ministry of Foreign Affairs summoned Iran’s deputy ambassador and denounced the attack as a “grave violation of the safety of international navigation, a direct threat to global energy supply security, and a clear and flagrant breach of international law.”
Gregory Brew, Iran and oil-focused senior analyst at Eurasia Group, noted the limitations of Iran’s strategy in the waterway during remarks Tuesday.
“Iran probably can’t enforce a tolling system in the strait — its effective leverage doesn’t extend that far,” Brew said, adding that “these sporadic attacks inject enough uncertainty to preserve some of its wartime position.”
Data from the vessel-tracking platform Windward showed multiple ships that had been using a southern passage along the Omani coast began rerouting toward Iran, potentially to avoid drawing the attention of Iranian drones.
Brent crude futures, the international benchmark, settled 3% higher at $74.16 per barrel, while U.S. West Texas Intermediate futures advanced 2.8% to $70.44.
In after-hours trading, Brent crude popped 5.6% to $76.04, while WTI jumped 5.4% to $72.25, reflecting growing market anxiety over the deteriorating security situation.
Tariq Zahir, managing member at Tyche Capital Advisors, warned that if Iran continues attacking ships or negotiations collapse, “all bets are off” and prices could see a sharp rise.
The Strait of Hormuz handles roughly a fifth of global oil consumption daily, along with large volumes of liquefied natural gas, making any prolonged disruption a serious threat to global energy markets.
Negotiations between the U.S. and Iran remain ongoing despite the violence, U.S. officials told Reuters, though the attacks have placed the fragile agreement under significant strain.
