Brent hits six-week high above $97 as US-Iran tension escalates

Brent crude futures rose $1.66, or 1.7%, to $97.29 per barrel, with U.S. West Texas Intermediate up $2.03, or 2.2%, to $93.04. Both benchmarks are on track for a fourth consecutive day of gains, having touched six-week highs earlier in the session. For UK buyers, this is the sharpest sustained oil move in weeks and one worth tracking against your own fuel and freight-linked costs, even where gas remains the primary driver of your energy bill.

The move follows U.S. strikes on Iran that Iran's health minister said killed 18 people and injured 108, with the Iranian Red Crescent reporting four deaths at a wedding near the Strait of Hormuz and Tasnim news agency citing three Iranian Army pilots killed. Israeli Defence Minister Israel Katz repeated threats to cripple Iran's military and civilian infrastructure, including energy facilities, if Tehran retaliates. Saxo Bank analyst Ole Hansen said Katz's comments directly contributed to the price rise, and Reuters reported the conflict is now in its seventh month, the most serious U.S.-Iran clash since July.

The chart below tracks Brent crude over the past six months, giving context to how sharp this four-day run above $97 really is.

What does this mean for UK commercial buyers

Oil is not the direct price-setter for UK gas and power contracts, but it moves in the same risk complex and often pulls forward curves with it when Middle East supply is in question. Buyers renewing fixed contracts over the coming weeks should watch whether this becomes a sustained repricing or a short-lived spike tied to headline risk. Flexible and basket-priced contracts carrying an oil-indexed component will feel this first.

• Brent crude ($97.29/bbl, up 1.7%)
• WTI crude ($93.04/bbl, up 2.2%)
• Strait of Hormuz shipping volume: six vessels Wednesday versus a 10-day average of 13
• Iraqi exports rising to 2.34 million bpd in August from 1.35 million bpd in July
• Federal Reserve rate decision this month, adding a second variable to watch

UBS energy analyst Giovanni Staunovo said the oil market 'remains tight, with global oil inventories continuing to decline, leading to higher prices,' adding that Middle East tensions 'may also provide some support.' Preliminary shipping data cited by Bloomberg showed the drop in Hormuz transits as a tangible signal of trader caution, distinct from rhetoric alone. Iran has also expanded its list of vessels it considers non-compliant, exposing them to fines, confiscation, or detention if they attempt the strait.

Counterbalancing the risk premium, Iraq's export surge, helped by discounts and Iranian approval for its tankers to use Hormuz, points to spare capacity entering the market even as tensions build. Whether Brent holds above $97 through the next Fed decision and any further Iran-Israel exchange will determine if this becomes a lasting cost pressure or fades as quickly as it arrived.