Shipping companies are not sending oil and gas through the Strait of Hormuz because they fear their ships might be attacked.
Energy prices continued to rise on Tuesday as attacks by the United States and Israel on Iran intensified, along with the country’s response.
The S&P 500 recovered ground in the afternoon but still ended the day lower, as investors sought cover from the unpredictable effects that the fighting could have on the world economy.
It is not clear who attacked the tanker, Stena Imperative. Its U.S. operator, Crowley, described “aerial impacts” and said that a fire on board was quickly extinguished.
How long prices remain high will depend on what the United States, Israel and Iran do next.
Though the conflict is centered on the Persian Gulf, shipping companies fear that the Iran-backed Houthi militia in Yemen could resume attacks on vessels in the Red Sea hundreds of miles to the west.
The cartel pledged to increase output by 206,000 barrels a day from next month, and said that members would “closely monitor and assess market conditions.”
One of the world’s most vital maritime arteries saw a 70 percent drop in vessel traffic.
The day before nuclear talks were set to resume, Iran conducted live drills in the Strait of Hormuz, a strategic waterway for oil and gas shipments.
The day before nuclear talks were set to resume, Iran conducted live drills in the Strait of Hormuz, a strategic waterway for oil and gas shipments.