Oil prices fall after report of breakthrough in US-Iran talks

Oil prices have jumped after the US carried out new attacks on Iran, targeting a military site in Bandar Abbas, a strategic port city.

The US Central Command (Centcom) said its forces also shot down four Iranian drones “that posed a threat around the Strait of Hormuz”.

Global oil benchmark Brent rose by 3.75% to $97.83 (£73.15) a barrel, while US-traded crude was 4% higher at $92.22.

The strikes come despite a ceasefire between Tehran and Washington as the two countries hold talks to end the three-month-long conflict that has effectively closed the key Strait of Hormuz waterway, pushing up the cost of energy around the world.

Around a fifth of the world’s oil and liquefied natural gas (LNG) supplies usually pass through the strait.

Shortly after the US and Israel launched airstrikes on Iran on 28 February, Tehran responded by threatening to attack vessels using the shipping route.

Global energy prices have swung wildly since the conflict began, with Brent crude briefly surging to around $120 a barrel. Before the war it was trading at closer to $70.

The cost of oil had fallen sharply this week on hopes that a deal would soon be reached to reopen the Strait of Hormuz.

The latest strikes mark the second time in three days that the US has attacked targets in Iran, with Washington saying they were conducted in self defence.

Centcom confirmed strikes on southern Iran earlier this week, in which it targeted Iranian missile sites and boats attempting to lay mines in the strait.

It said those strikes were designed “to protect our troops from threats posed by Iranian forces”.

Iran called the new attacks “a grave violation of the ceasefire” and said it “will not leave any act of hostility unanswered.”

Kuwait’s military said on Thursday that it was intercepting “hostile missile and drone threats” without providing further details.