Global oil markets were rattled once again as renewed tensions in the Middle East triggered a sharp spike in crude prices. In the immediate aftermath of Israel’s strike on Iran’s nuclear program, oil prices recorded their largest single-day percentage gain since March 2022, when the war in Ukraine began.
Crude prices surged by as much as 13%, with Brent crude briefly surpassing 75 dollars a barrel on the London market and West Texas Intermediate (WTI) climbing past 73 dollars in New York. Though prices later eased, the spike highlighted the market’s vulnerability to regional tensions.
Traders are closely monitoring the situation, as the Middle East remains the world’s most critical hub for oil exports. Volatility in oil markets has become the norm in recent years, fueled by a string of global crises—from the Covid-19 pandemic and the ongoing Russia-Ukraine conflict to OPEC+ production maneuvers, the Hamas attack on Israel, previous Israeli strikes on Iran, and assaults on vessels in the Red Sea.
This latest escalation marks a significant flashpoint. Israel announced it had targeted Iran’s nuclear facilities, ballistic missile production sites, and senior military personnel. Notably, the nuclear complex at Natanz was reportedly among the damaged sites.
Markets reacted with particular concern over the strategic Strait of Hormuz, a key chokepoint for global oil transportation. Analysts at JPMorgan warned that in a worst-case scenario—such as the closure of the Strait or a broader response from major oil-producing nations in the region—prices could soar to between 120 and 130 dollars per barrel. That would nearly double current analyst forecasts.
The stakes are high: Iran has previously threatened to shut down the Strait of Hormuz, a move that could have catastrophic implications for global energy supply. According to Reuters data, the Strait is the primary export route for crude oil from key OPEC members—including Saudi Arabia, Iran, the UAE, Kuwait, and Iraq—most of which is destined for Asian markets.
