Oil tops 105 dollars and gas exceeds 80 euros as White House explores Iran strike options

Strike options and energy market reactions

Crude oil prices advanced on Thursday after reports that the White House asked the Department of Defense to draft strike options against Iranian targets. According to reporting by The Atlantic citing two administration officials, the requested options could be carried out before the US midterm elections on 3 November 2026. President Donald Trump stated that reaching an agreement with Tehran is currently not something he wants. Brent crude for December delivery climbed as much as 5.2% to 105.46 dollars per barrel, while West Texas Intermediate for November delivery rose 5.2% to 92.84 dollars per barrel. Energy traders also monitored an approaching hurricane moving toward offshore production platforms in the Gulf of Mexico.

Night transits and convoy protocols

Commercial tankers have continued traversing the Strait of Hormuz in organized convoys despite ongoing Iranian threats. Ships travel during the night along the Omani coastline, staying as far as possible from the Iranian mainland while escorted by US fighter jets and helicopters. Crews run with all deck lights extinguished and tracking transponders deactivated, relying on paper nautical charts and coastal lighthouses for navigation. Tanker captains check in by radio with the US military every 30 minutes to report coordinates and any sighted projectiles. Iranian forces continue targeting maritime traffic, with the United Kingdom Maritime Trade Operations reporting frequent incidents, including several crew fatalities in September and projectile strikes on a tanker north of Qatar. Vice President J. D. Vance told Reuters on Tuesday that Iranian strikes have damaged vessels but failed to halt navigation through the strait.

Escalating logistics costs and gas markets

Security risks have reshaped Gulf shipping economics, pushing daily passage fees through the strait to as high as 1.3 million dollars per tanker, compared to 30,000 to 50,000 dollars before the conflict. Market observers estimate that transport and logistics now represent approximately one-third of the final barrel price, up from single-digit percentages before hostilities began. Tanker captains operating in the waterway now command monthly salaries of 100,000 dollars. To avoid sending their own vessels through dangerous waters, several operators conduct ship-to-ship transfers, leaving hundreds of ships anchored off the Emirati port of Fujairah. European natural gas prices also moved higher, with the front-month Title Transfer Facility contract in Amsterdam rising 2.64% to 80.34 euros per megawatt-hour on Thursday. Commerzbank analysts tracked the disruption to liquefied natural gas traffic through the waterway.

However, the September level still corresponds to only about 20 percent of the number of LNG tankers that passed through the Strait of Hormuz before the Iran war.

Wall Street and sovereign debt markets

Higher energy benchmarks and persistent inflation risks weighed on US financial markets during Thursday trading. The Dow Jones Industrial Average hovered near 51,145 points, while the S&P 500 slipped to 7,782 points and the Nasdaq Composite fell 0.5% to 27,419 points. The yield on 10-year US Treasury bonds remained elevated between 5.32% and 5.35%, holding near its highest level since 2002. Elevated borrowing costs particularly affected technology equities, with Intel, Nvidia, and Broadcom sliding between 1.5% and nearly 3%. Market participants also evaluated corporate debt demands, following reports that Broadcom is preparing a 50 billion dollar financing facility for artificial intelligence developer OpenAI.