Oil prices soared on Wednesday after US President Donald Trump vowed that Iran would “pay a price” for its slow progress in negotiating a peace deal.
As of 7:15 a.m. ET, U.S. crude oil futures for July delivery rose nearly 2% to $89.72 per barrel, while international benchmark Brent crude oil futures for August delivery rose 1.3% to $92.74 per barrel.
The move came after President Trump made a social media post contradicting previous claims that hostilities with Iran were nearing an end.
“Iran’s military is a complete and utter mess, much of it no longer even exists, like the navy and air force. It’s been completely defeated. Iran is all talk and no action,” Trump said on Truth Social. “The Middle East bullies are dead!!! They took too long to negotiate a deal that would have been great for themselves. Now they’re going to have to pay the price!!!”
Earlier, the US military announced that it had completed strikes against Iranian military targets near the Strait of Hormuz.
The U.S. military carried out an attack on Iran on Tuesday night after a U.S. Apache helicopter was shot down the day before, according to U.S. Central Command. Centcom described the operation as a defensive and measured response to what it called Iranian aggression.
President Trump said Tuesday that Iran shot down a U.S. helicopter patrolling near the Strait of Hormuz, and signaled the U.S. would retaliate.
“The two pilots involved in the attack are safe and uninjured,” President Trump wrote on Truth Social. “Nevertheless, the United States must necessarily respond to this attack.”
Rystad Energy said the suspension of 11.8 million barrels a day of production by six Gulf producers caused the most severe oil supply disruption in modern history. The consultancy estimated cumulative production losses at 1 billion barrels and warned that each additional month of conflict could wipe out an additional 350 million barrels of production.
