Global crude oil prices extended gains for a fourth consecutive session on Thursday, with Brent crude remaining above $85 per barrel, as escalating tensions between the United States and Iran fuelled concerns over disruptions to key global energy supply routes.
As of 7 am IST, Brent crude was trading at $85.48 a barrel, up 0.53%, while US West Texas Intermediate (WTI) rose 0.84% to $80.27 a barrel. Both benchmarks had also gained around 0.3% in the previous session and remained near one-month highs.
The latest rally followed US strikes on Iranian missile sites and coastal defence positions on Wednesday after Washington reimposed a naval blockade on Iranian ports. Iran described the conflict as an “existential war” and warned it could disrupt additional regional energy exports.
Supply Concerns Intensify
The renewed hostilities have heightened fears over oil shipments through the Strait of Hormuz, a strategic waterway that previously carried around 20% of global oil and liquefied natural gas trade. The conflict resumed last week, ending a fragile truce reached in June.
Analysts also warned that risks could spread beyond the Gulf, with Iran signalling it may use its Houthi allies in Yemen to threaten shipping through the Bab el-Mandeb Strait, another vital global energy corridor.
Analysts See Further Upside
According to Hiroyuki Kikukawa, Chief Strategist at Nissan Securities Investment, geopolitical tensions are driving buying sentiment in the oil market.
While regional mediation efforts continue and a full-scale war is still considered unlikely, he said WTI crude could climb to $85–$87 per barrel if the conflict escalates further.
Investment bank Goldman Sachs said Brent crude could exceed $110 per barrel in the fourth quarter if Gulf export disruptions persist. However, it noted that prices could fall into the $60 range by year-end if geopolitical tensions ease and oil production recovers more quickly than expected.
Airlines Feel the Pressure
Higher oil prices are already affecting fuel-intensive industries. United Airlines said it now expects nearly $6 billion in additional fuel costs this year compared with its initial 2026 forecast, citing the recent rise in crude prices.
Despite the higher fuel bill, the airline raised the lower end of its annual profit forecast, supported by strong travel demand, higher ticket prices and reduced industry capacity.
US Inventories Decline
Supporting prices further, the US Energy Information Administration (EIA) reported that US crude stockpiles fell by 1.7 million barrels in the week ending July 10. Analysts had expected a larger decline of 2.6 million barrels.
Although oil prices have risen sharply in recent days, they remain below the $126 per barrel peak reached during the earlier phase of the Middle East conflict.
