WTI crude oil prices climbed sharply on Tuesday, rising 1.94% to $64.02 per barrel as of 17:08 GMT+5:30, amid escalating geopolitical tensions in the Middle East. The move follows reports that Iran fired live missiles toward the Strait of Hormuz during large-scale maritime military exercises.
The Strait of Hormuz is one of the world’s most critical oil transit chokepoints, with nearly 20% of global oil supply passing through the narrow waterway. Any military escalation in the region typically raises immediate concerns about potential supply disruptions, prompting traders to price in a geopolitical risk premium.
The spike in crude prices comes as the United States and Iran hold their second round of indirect talks in Geneva over Tehran’s nuclear program. While negotiations are ongoing, tensions remain high. Iranian media reported missile launches targeting the Strait as part of Revolutionary Guard drills, marking the second live-fire exercise in recent weeks.
Meanwhile, the U.S. has increased its military presence in the region, deploying additional naval assets including aircraft carriers. Iranian leadership has warned against military pressure, while U.S. officials have reiterated their preference for a negotiated settlement.
The combination of nuclear talks, military exercises, and heightened naval deployments has injected fresh volatility into energy markets. Traders are closely monitoring developments in Geneva and the Strait of Hormuz, as any escalation could significantly impact global crude supply flows.