Oil prices extended their rebound on Friday after reports that Iran attacked what it described as "hostile targets" in the Strait of Hormuz, reviving fears over disruptions to one of the world's most important energy shipping routes. Brent crude climbed above $83 a barrel after rallying nearly 4% in the previous session, while West Texas Intermediate traded close to $78.
The latest gains came after Iran's semi-official Fars News Agency reported explosions near Qeshm Island in the Strait of Hormuz, with Tehran targeting hostile vessels as it seeks tighter control over traffic through the strategic waterway.
This marks another sharp shift in oil markets after traders had briefly priced in the possibility of easing tensions. Earlier this week, crude prices had fallen on optimism that an agreement between Iran and Oman could restore shipping through Hormuz.
Those hopes have faded as details of the proposed arrangement suggest Iran wants to block US and Israeli ships from the strait and impose compensation charges on what it considers hostile countries.
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The Strait of Hormuz carries roughly a fifth of the world's oil supply, making any threat to shipping a closely watched risk for global energy markets. Even the prospect of prolonged restrictions has been enough to push traders back into crude futures after several sessions of heavy selling.
US President Donald Trump said negotiations were continuing and repeated that he believed the conflict would end "pretty soon," adding that discussions around the strait were "moving along good." Diplomatic differences remain significant, however. Washington continues to insist on unrestricted passage through the waterway and a return to pre-war arrangements, while Iran is seeking greater control over transit.
Meanwhile, Iran-backed Houthi militants claimed responsibility for a "large-scale" attack against forces aligned with Yemen's Saudi-backed government after earlier targeting a Saudi oil tanker in the Gulf of Aden.
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