Renewed exchange of fire between the U.S. and Iran has driven global oil prices to $96 as the Strait of Hormuz—the narrow waterway between Iran and Oman—becomes a battleground, causing major disruption in the global oil market.

With the movement of vessels through the Strait of Hormuz under threat as U.S. and Iranian forces exchange fire, Brent crude oil prices have hit $96 per barrel, nearly a six per cent increase in recent weeks.

Since the conflict erupted between the two countries in February, the cost of global crude has jumped by almost 33 per cent, causing ripple effects in major economies around the world.

After the June ceasefire agreement failed, the U.S. said its forces have continued attacks to “degrade Iran’s ability to threaten civilian mariners and commercial vessels,” for the 12th straight night.

In retaliation, Iran has launched attacks on U.S. military bases in the Middle East, killing at least three American servicemen. 

Also, the Iran-backed, Yemen-based militia, the Houthis, have threatened a blockade in the Middle East, claiming to have attacked two Saudi oil tankers in the Red Sea.

In a post on Truth Social on Wednesday, President Donald Trump threatened that the U.S. will start attacks on Iran’s infrastructure, should any vessel be attacked in the Strait of Hormuz.

“From this point forward, any time the Islamic Republic of Iran shoots at a ship in the Strait of Hormuz, whether it be by missile, rocket, drone, or any other device or weapon, the United States will bomb and destroy one bridge or power plant, including those located next to, or in, the capital city of Tehran,” Mr Trump said.

Meanwhile, top Iranian negotiator Mohammad Bagher Ghalibaf, in a post on X on Wednesday, warned that, “In a region where we do not sell oil, no one will sell oil.”

He added, “If our security is not ensured, no infrastructure will be safe, and the security of the strait is in the absence of American forces. We have repeatedly said that the situation of the strait will not return to pre-war conditions.”