International oil prices rose by more than 1% in early Asian trading on Monday after a US military strike on Iran-linked targets at Larak Island in the Strait of Hormuz and an Iranian retaliatory attack on two US air bases in Jordan. Brent crude gained $1.08, or 1.23%, to $89.18 a barrel, while West Texas Intermediate rose 92 cents, or 1.10%, to $84.32.

US Central Command said its forces targeted two Iranian missile or rocket launchers on Larak Island in the first direct US attack on Iranian targets there since late July. Iran's Islamic Revolutionary Guard Corps launched its response on Monday morning. IG Markets analyst Tony Sycamore said the conflict appeared to have entered a renewed phase of escalation, though its duration remained uncertain.

Talks aimed at ending the conflict remain stalled as mediators seek to reopen the Strait of Hormuz. Shipping data showed visible cargo vessel traffic through the waterway fell to five ships a day over the weekend. ANZ analysts said increased oil flows had eased supply worries somewhat, but full reopening remained uncertain.