Oil prices jump more than 7% after Trump threatens to bomb Iran again

Oil prices spiked Wednesday, after President Donald Trump threatened to bomb Iran again and declared the ceasefire with the country over.

West Texas Intermediate futureswere 7.3% higher at $75.58 per barrel. Brent crude, the international benchmark, jumped 7.55% to $79.76.

Trump was asked at the NATO alliance summit in Ankara, Turkey whether the ceasefire with Iran was over. The U.S. bombed Iran overnight in retaliation for attacks on three tankers that crossed the Strait of Hormuz on Tuesday.

“To me, I think it’s over,” Trump said at a joint press conference with NATO chief Mark Rutte. “I don’t want to deal with them anymore … as far as I’m concerned, it’s over.”

Trump added that Washington’s delegation wanted to negotiate a peace deal but that he saw it as “a waste of time dealing with” the Iranian side.

He later threatened to bomb Iran again Wednesday night.

“We’ll probably hit them hard again tonight,” the president said during a press conference with Ukrainian President Volodymyr Zelensky. “I’ll give them a little warning. We’re going to hit them hard tonight.”

WTI Crude

The U.S. bombed more than 80 targets in Iran overnight including its air defense systems, command and control networks, radar sites, anti-ship missile capabilities and small boats, according to a statement from U.S. Central Command.

A ceasefire reached between the two sides last month reopened the critical Strait of Hormuz for commercial shipping after months of disruption.

Signaling that things have taken a turn for the worse, the U.S. Treasury Department on Tuesday withdrew a waiver that had allowed Iran to sell its oil.

In a statement earlier Wednesday, Iran’s foreign ministry labeled the strikes a “gross violation of the Memorandum of Understanding” Washington and Tehranreachedlast month to bring their war to an end.

“The powerful armed forces of the Islamic Republic of Iran, as they have repeatedly shown, will not hesitate to defend Iran’s territorial integrity, national sovereignty, and national security against American military aggression,” the ministry said, according to a Google translation.

Three vessels were attacked in or near the Strait of Hormuz on Tuesday, according to the U.S.-led Joint Maritime Information Center, which raised its threat assessment for ships transiting the waterway to “severe,” warning that further hostile action by Iran was likely.

“It’s not in Iran’s best interest to settle on a deal with their leverage over Trump only increasing the closer we get to November, although yesterday’s attacks coincide with the ongoing state funeral ceremonies for Ali Khamenei,” said Andrew Jackson, a strategist at Ortus Advisors.

The U.S. midterm elections are due in November, and Mideast conflict-induced inflation stands to raise the political stakes for the Trump administration.

“The corresponding jump in oil and yields and likelihood that the Fed will be forced to take a more hawkish stance with inflation here to stay,” he said in an email. The 10-year Treasury yield was trading 5 basis points higher at 4.581%.