Oil prices climb as Iran restricts Strait of Hormuz traffic ahead of ceasefire deadline

Oil prices rose sharply on Sunday as shipping through the Strait of Hormuz remained restricted as the US-Iran ceasefire approaches its expiration.

Brent crude, the international benchmark, climbed about 7 per cent to $96.88, while US crude rose 7 percent to $90.33.

The increase came after prices had fallen earlier in the week on hopes that the waterway would reopen.

However, according to CNN, Iran said on Saturday it was once again closing the strait to most traffic, accusing the United States of “breaches of trust.”

Tensions escalated further after the US Navy fired on and seized an Iranian-flagged cargo vessel that attempted to bypass a US blockade in the Gulf of Oman.

Shipping data showed that no oil tankers passed through the strait on Sunday, adding to concerns over supply disruptions.

The developments come as a temporary ceasefire between Washington and Tehran is set to expire on Wednesday, raising uncertainty about the future of global energy markets.

Rising oil prices are also expected to impact consumers as US Energy Secretary Chris Wright told CNN that petrol prices, currently averaging $4.05 a gallon, may not fall below $3 until “next year,” while adding it could still happen “later this year.”