Crude Oil Price: Trump’s statement created panic in crude oil, the price jumped 10% from the low level and reached near $85.

Crude Oil Price Hike: The impact of the ongoing war between America and Iran in the Middle East is now clearly visible. A sharp increase in crude oil prices was seen after Trump’s statement of imposing 20 percent tax in the Strait of Hormuz. The price jumped 10 percent from Monday’s low to near $85, touching a four-week high. The main reason for the rise in crude prices is that America has resumed its naval blockade on Iran. There are continuous attacks from both the countries around Hormuz. These latest attacks have increased concerns about global fuel supplies.

On Tuesday morning, Brent crude futures were trading $1.68, or two percent, stronger at $84.98 a barrel. While US West Texas Intermediate (WTI) crude rose $1.65, or 2.1 percent, at $79.79 a barrel. Brent had risen 9.6 percent in the previous session, its biggest one-day gain since May 2020.

Why did the price of crude oil rise?

us President donald trump wrote in a post on Truth Social that the US should pay a 20 percent duty on cargo, or more than $30 million, on entire supertankers carrying oil. Apart from this, US Central Command attacked several targets in Iran for the third consecutive night. On Tuesday, from 4 pm Eastern Time, ships entering and leaving Iranian ports were again banned. Citing Saudi Arabia, United Arab Emirates, Qatar, Bahrain and Kuwait, Trump said that the US will be paid by those countries which are helping to project the strait.

Crude oil prices are rising again after falling more than 30 per cent during April-June as the US-Iran ceasefire came into effect and the two countries also signed an MoU to end the four-month long war. This fragile ceasefire did not last long. Reports also suggest that Iran managed to ship out at least 57 million barrels of crude oil in the gap between the first US naval blockade and this time.

Will crude oil become more expensive?

Jay Hatfield, chief executive officer of Infrastructure Capital Management, said that they were sending oil out at very high rates. We think we will stay around this $80 level unless there is some movement on the Strait. But I don’t think we will go to $90 or $100. And if the strait opens again, we will quickly reach $60.

Also read: Crude Oil PriceCrude fueled by US-Iran tension, price crosses $79; Danger of expensive petrol and diesel in India!

Iran’s counterattack on Trump’s demand

Foreign Minister of Iran Abbas Araghchi Iran has reiterated that it will retain control of the Strait of Hormuz. In a post on social media platform Araghchi said that we (Iran) will remain impartial.