Brent crude fell 1.0% intraday to $98.57/bbl.

Iran has signaled willingness to escalate its confrontation with the United States after an initial attack on a U.S. warship, with senior leaders issuing increasingly hardline warnings. Facing mounting economic pressure and worries that control over the Strait of Hormuz is weakening, Tehran is adopting a more aggressive posture; a U.S. maritime blockade has left Iran almost unable to export oil, its main revenue source. Analysts say the situation raises the risk recent clashes could broaden toward full-scale war and that Iran is likely to try to intensify military pressure while avoiding outright war, aiming to push global oil prices higher or force a closure of the Strait of Hormuz.

Iran's foreign ministry said US warships and bases were hit in defensive strikes.