Oil prices move higher as Iran threatens response to latest U.S. strikes
Oil prices are fluctuating as geopolitical tensions rise between the U.S. and Iran following retaliatory strikes in the Middle East. The market is reacting to threats of further escalation and the formation of a Saudi-led maritime coalition to protect trade routes.
Why it matters
Instability in the Middle East directly impacts global energy markets, causing price volatility that affects inflation and international trade logistics.
Oil prices fell Thursday after Saudi Arabia proposed a naval coalition to protect key trade routes as ships come under attack from Iran and its allies in the Red Sea and Strait of Hormuz.
Brent crude futures, the international benchmark, lost nearly 2% to close at $89.03 a barrel. U.S. West Texas Intermediate futures fell about 1% to settle at $83.59 per barrel.
The Saudi Defense Ministry said more than 40 countries attended a meeting to discuss "strengthening maritime defense cooperation and unifying efforts to protect the security of maritime passages," according to statement translated from Arabic.
The effort to forge a naval alliance comes as Iran's Houthi allies in Yemen declared a maritime embargo of Saudi Arabia last week. Iran has repeatedly attacked ships transiting the Strait of Hormuz.
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