Oil prices climbed on Tuesday after the U.S. reportedly struck Iran's Qeshm Island late Monday, one day before the midterm elections, according to the source report.
Brent crude rose 1.75% to $106.60 per barrel, and West Texas Intermediate rose 1.7% to $98.10. Oil prices had rebounded a day after the U.S. and Iranian presidents signaled openness to a diplomatic solution to the Iran war. On Monday, oil prices had sold off more than 7%.
U.S. officials told The Wall Street Journal that Washington attacked Qeshm Island on Monday. The officials said the U.S. has carried out "limited strikes" against Iran in recent weeks. The report, citing an unnamed official, said the military campaign has been kept deliberately low-profile to avoid signaling plans for a major escalation.
Vice President JD Vance told CNN, "The president and I both feel really good about the prospect of potentially coming to a negotiated settlement." Secretary of State Marco Rubio said on Sunday that President Donald Trump would like to resolve the Iran war "diplomatically" and prefers not to use military force.
The source says high oil prices have contributed substantially to inflation and high gasoline prices in the U.S., which are a concern for Trump ahead of the midterm elections. Last week, two Federal Reserve presidents said interest rates will need to move higher to curb inflation.