LONDON: Oil prices surged nearly 7% on Wednesday after US President Donald Trump warned that Washington would hit Iran “hard” following a missile attack on US military bases in Jordan.
Front-month Brent crude rose 6.7% to $89.74 a barrel in early US trading, while West Texas Intermediate (WTI) futures climbed 6.6% to $84.51 after a sharp sell-off earlier this week.
The renewed escalation undermined diplomatic efforts to end the five-month conflict, which has already disrupted shipping through key oil transit routes and fuelled volatility in global energy markets.
Trump vows military response
Trump said the US military would strike Iran “hard” after Tehran launched missiles at US military facilities in Jordan, according to Fox News.
Fox News correspondent Trey Yingst quoted Trump as saying: “We’ll be hitting them hard. They’re going to get a beating,” adding that the US president used expletives to emphasise his warning.
The remarks marked a sharp escalation after Trump had previously expressed optimism about reaching a negotiated settlement with Tehran.
Iran said it had fired missiles at US military facilities in Jordan, while Jordan’s armed forces said they intercepted five Iranian missiles targeting the kingdom’s territory. The Jordanian military said its air defences shot down all five missiles.
Meanwhile, the US Central Command said American forces intercepted multiple Iranian ballistic missiles aimed at US forces in the Middle East and remained “vigilant”, although it did not specify the location of the attempted attack.
Markets react
The sharp rise in crude prices added to broader market uncertainty. Wall Street stocks fell ahead of the US Federal Reserve’s interest rate decision as investors weighed the risk that higher oil prices could rekindle inflation.
Brent crude has traded in a wide range this month, swinging from as low as $72 to as high as $102 amid uncertainty over the conflict and the security of oil shipments from the Middle East.
The latest escalation came despite Trump’s recent comments that Washington and Tehran had held “good talks” and that a diplomatic breakthrough remained possible.
Speaking to Fox News on Tuesday, Trump accused Iran of publicly denying negotiations while discussions were ongoing and warned that the United States would resume military strikes if diplomacy failed.
He also reiterated his threat to target Iran’s heavily fortified Pickaxe Mountain nuclear site and other strategic facilities if negotiations collapsed.
Earlier this week, Trump said the United States and Iran were continuing negotiations under the Islamabad Memorandum of Understanding (MoU), brokered by Pakistan and signed in June.
He said Iranian negotiators had urged Washington not to resume military action while talks continued.
According to the Islamabad MoU, the two sides agreed to halt military operations, reopen the Strait of Hormuz to commercial shipping and negotiate a broader agreement on Iran’s nuclear programme, sanctions and a permanent ceasefire.
