Oil prices extended their rally as Middle East tensions escalated and the US unveiled a plan to insure and escort tankers through the Strait of Hormuz. West Texas Intermediate surged above $75 a barrel, marking an 11% gain over two days—the largest jump in four years. Brent crude closed near $81 amid mounting concerns about supply disruptions in the vital waterway.

President Donald Trump announced that the US International Development Finance Corporation would provide insurance for vessels and naval escorts if necessary. The move comes as Iraq began shutting its Rumaila field and West Qurna 2 project, which together account for a majority of the country's oil output. The global oil market has been thrown into turmoil by the US-Israeli conflict with Iran, with strikes and counter-strikes spreading across the region.

Tanker traffic through the Strait of Hormuz has nearly halted since the conflict began, with vessels avoiding the chokepoint due to mounting risks. Tehran has threatened ships ignoring its warnings, claiming to have struck more than 10 tankers with various projectiles. The US president declared on social media that America would ensure the FREE FLOW of ENERGY to the WORLD, though details of the insurance mechanism remain unclear. Traders are now watching for official US inventory data due later Wednesday, following a report showing crude stockpiles rose 5.7 million barrels last week.