Oil & Gas

Oil and gas prices rose strongly after Israeli and U.S. strikes on Iran, followed by retaliatory actions from Tehran, forced shutdowns of several oil and gas facilities and disrupted maritime traffic in the Middle East. Brent crude jumped as much as 13% to $82.37 per barrel, its highest level since early 2025, while U.S. West Texas Intermediate (WTI) climbed over 12% intraday, reflecting heightened geopolitical risk and uncertainty over supply continuity. The surge, though significant, was slightly lower than some market expectations, as traders had already priced in potential conflict risks over the weekend.

The Strait of Hormuz remains the most critical pressure point, as approximately 20 million barrels per day of crude and refined products  nearly one-fifth of global consumption pass through this narrow shipping lane, along with a substantial share of the world’s liquefied natural gas. Reports of damaged tankers, a seafarer casualty, and more than 150 ships stranded around the strait underscore the scale of disruption. Additionally, a major Saudi refinery shutdown following a drone strike further intensified supply concerns and reinforced fears of extended regional instability affecting global energy flows.

Natural gas markets also reacted sharply, with European benchmark prices rising over 25% at peak levels, indicating broader energy supply stress beyond crude oil. Analysts caution that a sustained rise in oil prices could reignite inflation, increase global fuel costs, and slow economic recovery, especially for major energy-importing nations. While OPEC+ has announced a modest output increase, most producers are already operating near capacity, limiting their ability to offset a prolonged supply disruption. Energy agencies and global markets are now closely monitoring the conflict, as any escalation could trigger one of the most significant oil and gas supply shocks in recent decades.