Oil prices moved higher on Thursday, driven by a fresh wave of geopolitical tension. The United States has pledged severe economic action against Iran and threatened to punish its supporters, while the United Arab Emirates announced a halt to trade with Tehran. International benchmark Brent crude rose 1.59% to $93.08 per barrel, while US West Texas Intermediate crude for September delivery gained 1.63% in early trading, reaching $87.23 per barrel.

In a post on his Truth Social platform, former President Trump stated he had offered the Islamic Republic a chance to reach a deal, but lamented that Iran failed to seize the opportunity. He declared the launch of the toughest economic action ever imposed on a nation, describing it as an unprecedented economic war and total isolation. Trump further warned that any country assisting Iran would face extremely severe economic consequences, targeting channels such as cash transfers, currency swaps, and vessel registration.

The rise in oil prices followed the UAE's announcement on Wednesday that it would cease all trade and financial dealings with Iran. The UAE, one of Iran's key trading partners, reported that two ballistic missiles were fired from Iran toward its territory on Tuesday. Iran's Foreign Ministry spokesman, Esmail Baghaei, denied any involvement in the attack.

This development adds further strain on Iran, which is already grappling with multiple rounds of US economic sanctions. The prospect of reviving a ceasefire agreement now appears increasingly remote, as tensions continue to escalate in the region.