Global oil prices climbed around 3% on Monday, with Brent crude rising above $90 per barrel for the first time in more than a month as growing conflict between the United States and Iran heightened concerns over global energy supplies.
By 0612 GMT, Brent crude futures had gained $2.77 (3.14%) to $90.87 per barrel, while US West Texas Intermediate (WTI) crude rose $2.35 (2.85%) to $84.84 per barrel.
Both benchmark contracts reached their highest levels since mid-June after recording weekly gains of more than 15%, marking their strongest weekly performance in several months.
Conflict Fuels Rally
Oil prices extended last week’s sharp gains after the United States carried out a ninth consecutive day of strikes against Iran, while regional allies including Kuwait and Bahrain also reported Iranian attacks.
The escalating conflict has intensified fears that military action could further disrupt energy supplies from the Middle East, a region that remains critical to global oil production and exports.
Analysts at ING said Brent crude had moved above $90 as there was no sign of a slowdown in the exchange of attacks between Washington and Tehran.
They warned that if the conflict continues to escalate, the Gulf region could once again witness widespread military confrontations.
Hormuz Under Pressure
Concerns have also grown over the security of the Strait of Hormuz, one of the world’s busiest oil shipping routes, through which roughly one-fifth of global oil trade normally passes.
Iran’s Islamic Revolutionary Guard Corps (IRGC) claimed that two oil tankers exploded and became immobilised while attempting to use what it described as an unsafe southern route through the strait. The Guards alleged that the vessels had been encouraged by the US military to transit the area.
Oil Prices Climb to One-Month High as US-Iran Conflict Raises Supply Concerns
However, Reuters said it could not independently verify the claim, and no further details about the vessels or any casualties were immediately available.
Shipping Activity Slows
According to data from LSEG, only four vessels passed through the Strait of Hormuz on Sunday, compared with eight the previous day, reflecting increased caution among shipping companies.
The United Kingdom Maritime Trade Operations (UKMTO) also reported that a vessel was on fire northwest of Kumzar, Oman, although it did not confirm the cause of the incident.
Market Outlook
Analysts say the coming days will be critical in determining whether oil exports from the Gulf can continue without major disruptions.
Barclays analyst Amarpreet Singh said the market may still be underestimating the potential impact of prolonged conflict on global oil inventories, noting that current stockpiles are already at their tightest levels in five years.
With tensions showing little sign of easing and shipping activity remaining below normal levels, investors continue to closely monitor developments in the Middle East for their potential impact on energy markets and the global economy.
