Oil Prices Jump 6% as Iran Sets UAE Oil Port Ablaze, Strikes Vessels in Strait of Hormuz

• Oil prices jumped about 6% on Monday, May 4, 2026, as Iran stepped up attacks on the United Arab Emirates (UAE) and ships in the Middle East Gulf, with Brent rising 5.8% to $114.44 per barrel and WTI up 4.4% to $106.42.
• Iran hit several ships in the Strait of Hormuz and set a UAE oil port ablaze, as U.S. President Donald Trump’s attempt to use the U.S. Navy to free up shipping triggered the war’s biggest escalation since a ceasefire was declared in early April. Following the reported drone and missile attacks on the UAE by Iran, the UAE said it marked a serious escalation, and it reserved the right to respond.
• As part of its efforts to counter the escalation and maintain shipping access through the Strait of Hormuz, the U.S. military said it destroyed six Iranian small boats and intercepted cruise missiles and drones fired by Tehran.
• Notwithstanding, Trump has struggled to find a solution to the disruption of international energy supplies caused by Iran's blockade ​of the strait, which carried a fifth of global oil and liquefied natural gas (LNG) before the war. Without a deal to reopen the Strait of Hormuz, oil prices could remain above $100, and U.S. gasoline prices could reach $5 a gallon by June, according to analysts. Notably, motorists in California are already paying $6 per gallon.
• In response to the energy crisis, the UAE energy minister, following the country’s exit from the Organisation of the Petroleum Exporting Countries (OPEC+) last week, said it would continue producing to meet global market demand without restrictions, while cooperating with other producers. Meanwhile, OPEC+ said it would raise oil output targets by 188,000 barrels per day in June for seven members, marking the third consecutive monthly increase.

(Source: Reuters)