Oil climbs 5% as Iran, US both demand compensation and Hormuz hopes fade
Oil prices rose by 5% as tensions between the US and Iran escalated, dimming hopes for the reopening of the Strait of Hormuz. Both nations have issued demands for compensation and sanctions relief, complicating global energy supply chains.
Why it matters
Geopolitical instability in the Strait of Hormuz directly impacts global energy prices and economic inflation.
Oil prices have settled 5 percent higher after Iran and the United States traded demands for compensation, dimming prospects for a deal to reopen the Strait of Hormuz.
Iran also said the US must lift sanctions on Tehran, and meet a number of other conditions for reopening the vital waterway, while US President Donald Trump said Iran must pay compensation for "all of the people that they have killed and gravely wounded".
Brent crude futures LCOc1 settled up US$4.17, or 4.99 percent, at US$87.72 a barrel, while US West Texas Intermediate crude futures CLc1 closed $3.95, or 5.05 percent, at US$82.13.
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