Oil price surge as war with Iran expands
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July 23, 2026, 7:39 AM EDT / Updated July 23, 2026, 3:34 PM EDT
By Steve Kopack
Oil prices rose Thursday to their highest levels in nearly two months after the latest Iran war escalation threatened severe new disruptions to global energy supplies
Brent crude oil, one of two key global benchmarks, closed higher by 7%, at $100.69 per barrel. Earlier in the trading day, it rose as high as $102 per barrel. That is its highest level in eight weeks, since the end of May
U.S. crude oil also jumped for a second straight day, closing higher by 6.2%, at $92.19 per barrel — its highest close since June 4
The prices surged after Tehran-backed Houthi rebels claimed attacks on two Saudi oil tankers in the Red Sea following their announcement of a naval blockade on the kingdom
More on Iran war from NBC News
- Trump enters an uncertain moment in Iran war that threatens to become a quagmire
- That sinking feeling: Iranians feel the strain as Trump ramps up war again over Hormuz
- The costs of the Iran war are rising as Trump and Tehran signal no letup in the expanding conflict
It appeared to be the first time since the Iran war began that ship attacks had spread beyond the vicinity of the Strait of Hormuz, opening up a new front in the volatile conflict
The Houthi threat is so unsettling to oil markets because millions of barrels per day pass through the Bab el-Mandeb strait to reach global markets
About 12% to 15% of global maritime trade worth more than $1 trillion transits the waterway every year
It has also served as an alternative to theStrait of Hormuz, where traffic remains largely at a standstill, with ship crossings falling to single digits Tuesday
Since the start of the month, oil prices have now risen about 35%. Those prices are now higher by more than 60% since the start of the year
Along with oil prices, gas prices have risen, too
The national average price Thursday rose to $4.09 per gallon, up from $4.06 Wednesday
That has erased much of the progress toward lower prices after the U.S. and Iran signed a memorandum of understanding in mid-June
That deal has now collapsed, with President Donald Trump threatening Wednesday to blow up an Iranian bridge or power plant for every vessel Tehran attacks
Then, hours later, came the Houthi claim to have hit two tankers in the Red Sea
The United Kingdom’s Maritime Trade Office reported a tanker “struck by an unknown projectile” north of the critical Bab el-Mandeb strait in the area. And the state-run Saudi Press Agency reported the Encelia was set ablaze by an attack while it was sailing overnight in the Red Sea, citing an unidentifiedthe Layla
“Inflation has remained top of the agenda for markets this morning,” said Deutsche Bank’s global head of macro research, Jim Reid, citing the jump higher in Brent oil. “Indeed, the strikes between the US and Iran show no sign of easing, and the Houthis said they targeted two oil tankers in the Red Sea yesterday, raising fears that the conflict is widening.”
The worry about inflation as a result of higher oil and gas prices has driven bond yields higher this week. Early Thursday, the U.S. 10-year Treasury bond was trading at 4.7%, its highest level since January 2025
The 10-year bond has a heavy hand in steering consumer borrowing rates. On Wednesday, the average 30-year U.S. mortgage rate rose to 6.85%, its highest level since July 2025
Inflation worries and higher oil prices also hit stocks. The S&P 500 fell more than 1.3%, while the Nasdaq slid 2.4%. However, most of the selling came in tech stocks, after Alphabet and Tesla earnings failed to impress investors even though the companies posted generally positive results
