Oil prices climb as Trump pledge to protect shipping fails to reassure

4th Mar 2026 10:02

(Sharecast News) - Oil prices continued to climb on Wednesday, despite Donald Trump insisting the US Navy would protect a critical shipping route in the Middle East.

Oil and gas prices both surged after the US attacked Iran over the weekend, leading to the outbreak of escalating hostilities across the region.

Benchmark Brent crude, which was already trading at an above-average $73 a barrel last week, is now sitting well above $80.

As well as oil and gas facilities in the region either coming under attack or having to temporarily close, around a fifth of the world's oil and gas is transported through the Strait of Hormuz between Iran and the United Arab Emirates.

Now deemed too dangerous to pass through, Trump on Tuesday pledged that the US Navy would protect shipping using the narrow waterway "if necessary". He also posted on social media that the US government would provide risk insurance "at a very reasonable price" to all shipping firms in the region, to "ensure the FREE FLOW of ENERGY to the WORLD".

Brent initially fell back marginally, but quickly started to rise again as his comments failed to reassure jittery markets. By 0930 GMT Brent was up 2% at $83.41, while West Texas Intermediate was 2% ahead at $76.19.

Gas prices were also higher, with European national gas up 20%, having surged 93% over the last five days.

Richard Hunter, head of markets at Interactive Investor, said the "practicalities and likelihood" of the US Navy escorting tankers through the Iran-controlled waterway was "questionable".

He continued: "The underlying concerns remain firmly in place. Escalation and duration of the conflict were the main worries, and with the former now in place the length of the troubles will have increasingly indirect impacts."

Kathleen Brooks, research director at XTB, said: "$85 for Brent crude is a key level to watch. If the oil price breaks above this level, then it could open the door to $90 oil, which would be deeply uncomfortable for investors.

"There are also growing supply concerns. Iraq has cut production, after some of its facilities were hit, and stress is mounting for energy suppliers across the region.

"While the US remains the world's biggest energy producer, the Middle East is still a vital part of the global energy mix due to the large number of major suppliers. This suggests that risk to energy prices are still to the upside."

Emma Wall, chief investment strategist at Hargreaves Lansdown, said: "A number of oil exporters, including Saudi Arabia, and indeed importers such as China, have reserves outside of the conflict zone, which can provide some buffer, but are finite. Renewable energy sources will also help at the margin. But Hormuz resuming usual trade is essential for asset price normalisation.

"Some investors are questioning whether this triggers a financial crisis: a toxic combination of asset prices collapsing coupled with recession. Fear is understandable. But it is important to stress that a prolonged bear market is not our base case scenario."