Oil Prices Spike Past $90 on US Strike Near Strait of Hormuz Chokepoint

DUBAI: Brent crude briefly surpassed $90 per barrel during Asian trading after a US strike on Iranian launcher installations on Larak Island, as markets repriced risk to Middle East supply chains and the maritime corridors that carry Gulf oil to global buyers.

The price spike reflects the island’s strategic position. Larak sits near the Strait of Hormuz, the narrow waterway connecting the Persian Gulf to the Gulf of Oman and the critical passage for oil exports from Gulf producers, including the UAE. Any sustained disruption there would ripple across energy markets worldwide.

The aviation sector is already absorbing the cost. Multiple international carriers have suspended or significantly reduced UAE operations, with timelines stretching well into 2027. Air Canada has halted Dubai flights until mid-January 2027. Finnair has suspended Dubai and Doha services until March 27, 2027. KLM, Wizz Air, Singapore Airlines, British Airways and Cathay Pacific have all suspended Dubai operations through late October. Philippine Airlines has extended its Manila-Dubai suspension to October 2, while Lufthansa and Swiss have suspended flights until September 13. Each suspension represents lost revenue for carriers, airport operators and the broader UAE tourism and logistics economy.

By contrast, UAE carriers are holding their ground. Emirates, Etihad, flydubai and Air Arabia continue select regional routes, though certain services remain affected. Passengers should verify individual flight numbers directly with their airline or booking provider, as schedules can shift rapidly.

The trigger for this round of disruption was a drone that approached from Iran over UAE territorial waters on Monday. The UAE Ministry of Defence confirmed that armed forces responded to the unmanned aerial vehicle and that air-defence networks are now operating under continuous high-alert protocols across national airspace. The incident followed Iranian claims of strikes against American military positions in the region, widening a confrontation centred on the Strait of Hormuz.

Operationally, the UAE is projecting continuity. Schools are proceeding with the start of the 2026-27 academic year, with more than 1.277 million students returning under a phased, reduced-hours schedule from August 31 to September 3 before normal operations resume on September 4. Public services and commercial activity continue unless authorities announce otherwise.

Officials have instructed residents to rely exclusively on verified announcements from the Ministry of Defence, the National Emergency Crisis and Disaster Management Authority, police and official state media, rather than circulating unconfirmed social-media reports, videos or location data. On travel, the guidance is practical: confirm flight status directly with airlines before heading to any UAE airport, and avoid assuming closures or safety threats without official notification.

The key economic variable now is duration. Short suspensions impose manageable losses. Carrier withdrawals stretching into early 2027 signal that insurers and airline risk teams are pricing in a prolonged period of uncertainty, which would compound pressure on UAE aviation revenue, hotel occupancy and trade flows through one of the world’s busiest logistics hubs. Whether the US-Iran exchange around the Strait of Hormuz stabilizes or escalates will determine how many of those suspended routes return on schedule, and how many carriers quietly extend their timelines further.