Oil prices surge as Iran vows to attack ships in Strait of Hormuz

Oil prices have risen sharply again after Iran’s Revolutionary Guard Corps on Monday said it would fire on any ships trying to pass through the Strait of Hormuz.

Its announcement of the closure of the sea passage, which lies between Iran and Oman, threatens to choke what is the world’s most vital oil and gas route, accounting for a fifth of global flows.

Ebrahim Jabari, an adviser to the Guard’s commander-in-chief said it will also attack oil pipelines adding that it will not allow a drop of crude to leave the region.

Tehran has targeted infrastructure critical to the world’s energy production as part of its retaliation for the Israeli and US bombing campaign that began on Saturday.

As well as pushing up prices on global energy markets, the conflict has seen oil transport costs skyrocket with some of the world’s biggest maritime insurers cancelling war risk cover.

Analysts suggest crude oil prices could breach $100 a barrel if there is a prolonged disruption to shipping in the region.