Oil prices rebounded about 1% on Wednesday after touching a seven-week low in the previous session, supported by fresh Iranian response to U.S. military strikes, delivering a new blow to peace hopes.
The latest escalation came after the U.S. military targeted Iranian positions following US President Donald Trump's pledge on Tuesday to retaliate for the overnight downing of a U.S. Apache attack helicopter.
Crude oil price on June 10
Brent crude futures rose 83 cents, or 0.9%, to $92.29 a barrel, while U.S. West Texas Intermediate (WTI) crude gained 68 cents, or 0.8%, to $88.97 a barrel. The recovery follows sharp declines on Tuesday, when Brent settled at its lowest level since April 17 and WTI ended at its weakest since May 29. Prices eased after Israel and Iran suspended direct attacks on each other following Trump's call for both sides to step back.
Iran's Islamic Revolutionary Guard Corps (IRGC) said its Aerospace Force fired long-range solid-fuel missiles at an airbase in Jordan that hosts US military personnel. According to the IRGC, the strike targeted four strategic locations, including hangars housing F-35 fighter jets and a command-and-control centre. The group described the attack as part of a broader retaliatory campaign against US military assets in the region.
There was no immediate confirmation from either Jordanian or US officials regarding the extent of any damage or whether the targets were hit.
Separately, multiple explosions were reported in Bahrain, with more than 16 blasts heard across the country. Iraqi media reported that several Iranian missiles were seen heading towards Bahrain.
Tehran has warned that it would resume hostilities if Israel continues targeting the Hezbollah militia in Lebanon. Israel's refusal to halt its campaign against the Iran-backed group has complicated Trump's efforts to turn the fragile ceasefire linked to the broader U.S.-Israeli conflict with Iran into a lasting agreement.
Meanwhile, Iran continues to restrict most shipping through the Strait of Hormuz, a critical waterway that normally handles about one-fifth of global crude oil and liquefied natural gas flows. At the same time, Washington has imposed its own blockade on Iranian ports.
The United States has served as a marginal supplier of crude and refined products during the conflict, increasing exports to both Asia and Europe. Analysts note that declining U.S. crude inventories could limit export availability and add further support to oil prices.
Morgan Stanley said the oil market is in "a race against time", warning that the factors that have so far prevented a sharper rise in prices could begin to fade if the Strait of Hormuz remains shut through June.
According to the brokerage, stronger U.S. crude exports and weaker demand from China have helped absorb part of the supply shock. However, it cautioned that global supplies could tighten again if disruptions in the strategic shipping route persist, especially beyond the period during which the U.S. and China can offset the impact.
Haitong Futures said crude prices could move toward the upper end of their trading range as tighter supply-demand balances coincide with rapidly declining global oil inventories.
Analysts added that even if a ceasefire is reached, shipping flows through the Strait of Hormuz may take months to normalise. Any damage to energy infrastructure could further delay the recovery process.
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