Source: Sharecast
At 1020 BST, Brent crude was up 3.9% at $104.13 a barrel and West Texas Intermediate was 3.8% higher at $91.70.
According to Axios, the Pentagon instructed US Central Command several days ago to conclude preparations for resuming major combat operations in Iran.
It was understood that the directive didn't include a specific date for launching strikes, and Trump hasn't made any final decisions. However, US and Israeli sources said it could happen before the US midterm elections and possibly the Israeli elections a week earlier.
Sources told Axios that if major combat operations resume, they're expected to include massive bombing of Iranian energy, infrastructure and nuclear targets.
Neil Wilson, UK investor strategist at Saxo Markets, said the jump in the crude price was "pure headline premium and nothing concrete is known".
Investors were also mulling attacks by Yemen-backed Houthis on two Saudi airports - Abha International Airport and King Khalid International Airport in Riyadh - which killed three and injured 36 people.
Patrick Munnelly at Tickmill Group said: "Risk premia intensified further following Houthi attacks on Saudi airport infrastructure, raising concerns that Middle East disruptions are expanding beyond the Strait of Hormuz to threaten broader Gulf logistical networks.
"Soaring supertanker freight rates continue to compound the effective delivered cost of energy, with prediction markets pricing less than a 50% probability that shipping traffic through Hormuz normalises by mid-2027."
Also boosting oil prices was news that tropical storm Isaias was set to reach the US Gulf Coast by Friday.
Dan Coatsworth, head of markets at AJ Bell, said: "Concerns around potential damage from Tropical Storm Isaias has led Shell and Chevron to curtail offshore operations in the Gulf, adding to supply concerns that were already front of mind thanks to ongoing Middle East conflict.
"The higher the oil price goes, the more volatility to expect on financial markets. Bond investors have made it clear they are concerned by the prospect of rising inflation feeding into higher interest rates and potentially economic setbacks. Equity investors have been relatively relaxed versus bond investors thanks to positive corporate news flow keeping spirits high. But that situation might not be sustainable if higher costs start to crimp corporate profits."