U.S. And Iran Keep Trading Strikes. Oil Is Back Above $100 After More Than a Month.

Oil prices topped $100 on Wednesday as the U.S. and Iran kept trading strikes in the Strait of Hormuz and broader hostilities continued throughout the Middle East.

Brent crude, the international benchmark, climbed almost 3% and stood at $100.82 per barrel at 8:03 a.m. ET, while West Texas Intermediate, the U.S. benchmark, gained 2.82% and clocked in at $95.65 per barrel at the same time.

The U.S. Central Command (Centcom) said the latest escalation involved its forces destroying five Iranian tankers in retaliation for an attempted attack against a warship.

"The U.S. warship successfully evaded the attempted Iranian attacks and continued to patrol regional waters. No American personnel were harmed," Centcom added. "Iran has used the tankers as part of a multibillion-dollar shadow network that funds the IRGC and its regional proxies. Iran has no means by which to defend these vessels."

Iran, in turn, had claimed that its revolutionary guard had struck two U.S. vessels, along with eight oil tankers in the Gulf. Forces added that the vessels had sought to transit the Strait of Hormuz through areas it designated as "forbidden and unsafe."

The Trump administration also escalated pressure on Iran through economic means, sanctioning over a dozen airlines.

The department noted in a statement that, overall, the "Treasury's Office of Foreign Assets Control (OFAC) sanctioned 36 targets for supporting Iran's aviation sector, which the regime uses to move weapons, personnel, and illicit cargo."

The decision also targets "covert front companies, foreign intermediaries, and deceptive transshipment routes that Iran relies on to obtain U.S.-origin aircraft and sensitive technology."

"Under Operation Economic Outcast, we promised severe consequences for those providing financial lifelines to the Iranian regime," Treasury Secretary Scott Bessent said.

"Let this be a warning to anyone doing business with Iran's remaining airlines, all of which we sanctioned today: You are at risk of being cut off from the global financial system," he added.

As hostilities continue, Goldman Sachs is now warning that a prolonged disruption in the region could send Brent crude as high as $120.

Goldman Sachs raised its oil price forecasts this week, citing the prospect of prolonged shipping disruptions. The bank now expects Brent to trade at $85 a barrel in December and WTI at $80, both $5 above its previous estimates. Its 2027 forecasts stand at $80 for Brent and $75 for WTI.

Those baseline projections remain below current prices, but the bank's downside supply scenario is considerably more severe. Goldman warned that Brent could reach or exceed $120 if Gulf production and exports remain significantly constrained, particularly if attacks on vessels in the Strait of Hormuz and Red Sea intensify.