U.S. oil futures rallied Thursday in reaction to worsening tensions between the Iran and U.S. that may lead to a disruption of oil flow in the Strait of Hormuz.
Iran shot down a U.S. drone and U.S. President Donald Trump said in a tweet that "Iran made a very big mistake!" Language from Trump "has driven up oil as traders fear supply in the Middle East might be squeezed by Washington D.C. potentially taking a tougher stance on the country," said David Madden, market analyst at CMC Markets.
July West Texas Intermediate oil rose $2.89, or 5.4%, to settle at $56.65 a barrel on the New York Mercantile Exchange. That was the highest front-month contract finish since late May and biggest one-day dollar and percentage gain since December, according to Dow Jones Market Data. August WTI became the front-month contract at the day's settlement. It added $3.10, or 5.7%, to $57.07.
Source : MarketWatch