Missile and drone exchanges between Iran and the US threaten to derail a fragile ceasefire, lifting crude risk premiums ahead of Sunday’s futures open.
Iran’s Islamic Revolutionary Guard Corps launched missile and drone strikes on US military bases in Kuwait and Bahrain on Sunday, prompting US retaliatory strikes. Both sides accused each other of violating an interim ceasefire, raising the risk of a full collapse in the 14-point accord governing Gulf shipping lanes.
Shipping confidence had shown tentative recovery as vessels resumed transit through the Strait of Hormuz over the past two weeks. However, the renewed hostilities threaten to stall progress, keeping freight and insurance premiums elevated. Markets will monitor whether Iran follows through on threats to re-close the strait or target tankers in the southern Omani lane.
Crude futures open for trade at 2200 GMT, with early indications suggesting a rebound in the supply disruption premium. The USD remained stable in early FX trading, reflecting limited immediate spillover into broader risk sentiment.