Oil prices rise after report of US strikes on Iran's Qeshm Island

Oil prices increased during early trading in Asia on Tuesday following reports of U.S. military strikes on Iran's Qeshm Island. This development has raised apprehensions about a potential escalation in the ongoing conflict that has persisted for eight months, which could lead to further disruptions in oil supplies from the Middle East.

As of 0104 GMT, Brent crude futures climbed by 48 cents, or 0.5%, reaching $105.25 a barrel. Similarly, U.S. West Texas Intermediate crude saw a rise of 47 cents, also a 0.5% increase, bringing its price to $96.93 a barrel. On the previous trading day, Brent crude settled at $104.77 a barrel, down $8.66 or 7.63%.

The Wall Street Journal reported that the U.S. military action was aimed at Iran's Qeshm Island, with U.S. officials describing the strikes as defensive measures intended to deter Iranian attacks on commercial vessels navigating the Strait of Hormuz. Tim Waterer, chief market analyst at KCM Trade, noted that this news added a degree of risk premium to oil prices. He remarked, "Just when markets were starting to price in a more diplomatic path, this reminder of ongoing military activity has flipped the tone."

In parallel, Iranian officials stated on Monday that discussions between the U.S. and Iran aimed at resolving their ongoing conflict were ongoing. These talks, facilitated by Qatari mediators, had resulted in revised proposals but did not lead to any significant breakthroughs.

Former President Donald Trump expressed uncertainty on Monday regarding his commitment to a potential resumption of military strikes against Iran, suggesting that a deal with Tehran could still be possible.

The conflict between the U.S. and Iran, which began in late February, has significantly decreased maritime traffic in the Strait of Hormuz—an area previously responsible for transporting approximately 20% of the world's crude oil and natural gas supplies. The ongoing war in Iran has been identified as a primary factor contributing to rising gasoline prices, which are becoming increasingly burdensome for voters. Trump is facing mounting pressure to bring an end to this conflict.

As October concluded, Brent crude prices reached their highest levels in six months, fueled by concerns over the potential for renewed escalation in the Middle East conflict, particularly in light of the upcoming U.S. midterm elections.

Iranian President Masoud Pezeshkian announced that Supreme Leader Ayatollah Mojtaba Khamenei had authorized the government to pursue peace talks. Meanwhile, the U.S. is set to convene delegations from both Ukraine and Russia in Abu Dhabi on November 10-11 to discuss measures aimed at concluding Russia's war against Ukraine, establishing post-war security agreements, and promoting de-escalation efforts.

This report has been prepared based on information generated from a syndicated feed, with only the headline and image potentially adjusted by the Business Standard staff.

First Published: Nov 03 2026 | 7:32 AM IST