Global oil prices spiked sharply after Israel launched strikes on Iran, escalating tensions in the Middle East. Brent crude surged over 10% at one point, briefly hitting its highest level since January, before settling 7% higher at $74.23 a barrel. Traders fear the conflict could disrupt oil supplies from the region, which is critical to global energy markets.
Despite the rally, prices remain more than 10% lower than a year ago and far below the peaks seen after Russia’s 2022 invasion of Ukraine.
Stock markets across Asia, Europe, and the U.S. fell amid rising geopolitical risks. Japan’s Nikkei closed down 0.9%, the UK’s FTSE 100 slipped 0.39%, and the Dow Jones shed 1.79%. Investors flocked to safe-haven assets—gold rose 1.2% to $3,423.30 an ounce.
Analysts warn the situation could worsen, especially if Iran retaliates by targeting oil infrastructure or disrupting traffic in the Strait of Hormuz, through which a fifth of the world’s oil flows. However, any sustained price spike may prompt other producers to boost supply, potentially limiting long-term inflationary impacts. Retail fuel prices remain uncertain as markets await further developments.
