Oil prices retreat despite escalating Middle East tensions after Iran vows retaliation for US airstrikes in the Strait of Hormuz.
West Texas Intermediate crude fell to $71.70 per barrel Wednesday, erasing earlier gains as geopolitical risks competed with expectations of rising OPEC+ output. The decline follows Iran’s warning of a military response after US strikes targeted its forces in retaliation for attacks on commercial vessels, including a Qatari LNG carrier and Saudi oil tanker in the Strait of Hormuz.
Markets had anticipated a supply glut after OPEC+ increased production quotas and regional producers signaled plans to boost output. The sudden flare-up in the critical shipping lane contrasts with forecasts of oversupply, creating uncertainty over near-term price direction.
Iran’s parliament speaker declared an end to Western pressure tactics, while military leaders pledged a crushing response to recent strikes. Tehran also threatened to block US interference in the Strait of Hormuz, a key chokepoint for global oil flows.