Oil Prices Jump as US–Iran Fighting Intensifies, IRGC Says Strait of Hormuz Closed

Fresh strikes and competing claims over control of the strait have rattled investors and slowed tanker traffic.

Vessels are anchored in the Strait of Hormuz off Bandar Abbas in southern Iran, in this photograph obtained from Iran's ISNA news agency on May 4, 2026. Amirhossein Khorgooei/ISNA/AFP via Getty Images

Oil prices jumped and global stocks mostly retreated in July 13 trading after the United States and Iran exchanged fire in the Middle East and the Islamic Revolutionary Guard Corps (IRGC) vowed to block vessel traffic through the Strait of Hormuz until what it called U.S. “interference” in the waterway ends.

In early U.S. trading, the price of Brent crude, the international standard, gained 3.9 percent to $78.96 per barrel, while U.S. benchmark crude oil added 4 percent to $74.26 per barrel.

Prices for both types of crude had recently fallen back to around pre-war levels after Washington and Tehran in mid-June signed a memorandum of understanding that paused the conflict and—at least on paper—fully reopened the Strait of Hormuz for shipments of oil and other key commodities.

The two countries have not seen eye to eye on the organization of vessel traffic through the Strait of Hormuz, leading to periodic bouts of escalation.

Iran interprets point five of the memorandum as giving Tehran the right to control the maritime chokepoint—including the possibility of eventually imposing transit fees—while Washington insists on unrestricted passage for ships and no tolls.

Tehran has also objected to international efforts to establish a non-Iranian-controlled shipping corridor through the Strait of Hormuz along a southern route near the coast of Oman. Iranian forces have periodically attacked ships seeking to circumnavigate the northern passage through Iran’s coastal waters by opting for the southern route, where U.S.-assisted commercial transits continue despite what the Joint Maritime Information Center (JMIC) on Monday described as an “elevated threat environment.”

In the latest flare-up, Iran attacked a container ship in the strait on Sunday, setting it ablaze and leaving a crew member missing. The United States responded by launching several waves of strikes against Iran into Monday morning, with Tehran retaliating by targeting a number of U.S.-allied countries across the Middle East.

JMIC, which is supported by the U.S. and British naval forces, said Monday that vessel traffic in the waterway continued over the past 72 hours but at a reduced pace given “operator caution following recent attacks,” and the fact that the threat level in the key shipping corridor has been set to “severe.”

“IRGC attacks, hailing, UAS activity, and targeted surveillance continued throughout the period, indicating sustained harassment of commercial shipping and a continued intent to assert presence across key transit lanes,” JMIC said.

The U.S. military said Monday that its forces hit dozens of Iranian sites in a series of strikes, including radar sites and air defense systems, missile and drone equipment, and small boats.

U.S. forces patrol the Arabian Sea near M/V Touska on April 20, 2026. U.S. Navy via Getty Images

“The Strait of Hormuz is a vital maritime corridor for global trade,” U.S. Central Command said in a post on X. “Iran does not control it.”

The IRGC, a key power center in Iran that controls the country’s arsenal of ballistic missiles, issued a sharp response to America’s statement.

“The Strait of Hormuz is our territory, and we will not allow a rogue and child-killing army from the other side of the world to continue its illegal interference in it,” the IRGC said in a statement Monday.

It added that the only way to open the strait for vessel traffic is for the U.S. military to end its “interventions” in the waterway and respect Iran’s sovereignty over its coastal waters.

“The continuation of these interventions will lead to even greater incidents in the global oil and gas sector,” the IRGC warned, according to Tehran’s official IRNA news agency.

U.S. officials said Monday that about 20 vessels had been escorted through the Strait of Hormuz in the previous 24 hours.

Red and black pennants hang above a street as vehicles pass by during preparations for a farewell ceremony for Iranian leader Ayatollah Ali Khamenei, who was killed on Feb. 28 in Israeli and U.S. airstrikes, outside the Imam Khomeini Grand Mosalla, in Tehran, Iran, July 2, 2026. Reuters

At a press conference in Tehran on Monday, Iranian Ministry of Foreign Affairs spokesman Esmail Baghaei was asked to comment on the U.S. escorts and on control over the strait.

Baghaei described Washington’s efforts to escort commercial vessels through the strait as “perpetuating insecurity in the region,” adding that such conduct would “certainly not build confidence within the international shipping community; it will merely aggravate the current situation and further intensify the prevailing insecurity.”

The positions of ships on the Strait of Hormuz on a screen at the Maritime Information and Cooperation Centre in Brest, France, on April 27, 2026. Fred Tanneau / AFP via Getty Images

Maritime shipping traffic trackers noted reduced traffic in the Strait of Hormuz.

Kpler said vessel traffic through the strait had turned defensive, with a 52 percent week-over-week decline this past weekend. Windward reported that shipping through the southern Omani route had “effectively collapsed,” with just one of 12 outbound ships using it to transit, and zero inbound vessels.

Oil Rally Spreads Across Global Markets

Analysts at ING said in a note Monday that the “battle over Hormuz” was lifting oil prices as traders feared a return to major hostilities.

“Clearly, the risk is that this escalates to levels seen early in the war, where neighbouring countries and their energy infrastructure are also targeted,” they wrote. “Iran claims that the Strait of Hormuz is shut until further notice. The US pushed back, saying that it will ensure freedom of navigation. Escalation has slowed vessels transiting the strait to a trickle, renewing concerns over oil supply tightness through the third quarter.”

Alongside the uptick in crude prices, government bond yields rose, and global equities and U.S. stock futures edged lower.

Ships are docked at the Khor Fakkan Container Terminal pier in the Gulf of Oman on June 19, 2026. AFP via Getty Images

Wall Street futures fell in early trading Monday, with the S&P 500 futures contract down 0.4 percent and the Dow down 0.3 percent. The Nasdaq composite future lost 1 percent.

MSCI’s main world stocks index fell 0.38 percent, while Europe’s STOXX 600 was down 0.12 percent, with tech stocks falling 1.1 percent.

In Asian trading, Tokyo’s Nikkei 225 index lost 1.1 percent, while Seoul’s Kospi declined 5.6 percent.

Elsewhere in Asia, Hong Kong’s Hang Seng edged up 0.1 percent, while the Shanghai Composite index shed 1.2 percent.

In Australia, the S&P/ASX 200 declined 0.3 percent.