Oil prices jump as US sends third aircraft carrier to Middle East

Oil prices have surged after the US military began deploying a third aircraft carrier strike group and thousands of additional troops to the Middle East, signalling a potential escalation in the eight-month war with Iran.

Brent crude jumped more than 4 per cent to close at $102.31 a barrel, while US West Texas Intermediate futures rose 2.7 per cent to settle at $92.87. The market response reflects deep-seated fears that the growing military buildup will trigger retaliatory attacks on regional energy infrastructure and shipping lanes.

A major buildup in the Gulf

The Pentagon is dispatching the USS Theodore Roosevelt carrier strike group and the USS Makin Island amphibious readiness group to the Middle East. Together, these groups carry more than 7,000 sailors and 2,000 Marines. According to a US official speaking anonymously, the deployment could place three American carriers in the region by the end of October.

The new forces will join the USS George HW Bush and the USS George Washington, which are already on station. This will push the total US naval presence in the Middle East to more than 20,000 sailors and Marines, alongside hundreds of aircraft. It is the largest naval concentration in the region since the spring, and before that, the 2003 invasion of Iraq.

Trump signals post-election strikes

The decision to reinforce the region comes as President Donald Trump warns that military operations could soon intensify. In an interview with Time magazine, Trump said it is "possible" he will ramp up bombing in Iran after the US midterm elections on 3 November.

Trump also revealed he had rejected a recent ceasefire proposal from Tehran. Although the Iranian offer included a promise to "open up" the Strait of Hormuz—the world’s most vital energy corridor—Trump dismissed the deal, stating that the overall terms were "not good enough".

Tankers under fire

The threat to energy flows is already mounting. The UK Maritime Trade Operations reported this week that a tanker was hit by an unknown projectile while transiting the Strait of Hormuz. It was the third attack on a tanker in the area in a single week, illustrating the fragile nature of shipping security even as regional crude flows had briefly recovered to pre-war levels.

At the same time, the US naval blockade has effectively choked off Iran's own exports. Shipping data suggests Iran loaded no crude oil onto tankers in September.

The loss of Iranian supply coincides with a wider squeeze on global fuel markets. Recent Ukrainian strikes on Russian oil refineries forced Moscow to ban diesel exports, sending US diesel prices to a record average of $6.40 a gallon. To help ease the shortage and avoid imposing domestic export curbs, the Trump administration is currently pressing the European Union to release some of its diesel stockpiles.