Global oil prices have risen again, surpassing the $100 per barrel mark for the first time since mid-2022. This price increase occurred amid supply cuts from key producers and concerns about prolonged disruptions in shipping due to the escalation of conflict between the United States, Israel, and Iran in the Persian Gulf region.
This is reported by Finway
Sharp Rise in Oil Prices: Causes and Consequences
Currently, the price of Brent crude oil is estimated to be 50% higher than the level recorded before the start of the military operation by Israel and the U.S. against Iran. Specifically, Brent futures rose by $24.96, or 27%, reaching $117.65 per barrel, while American WTI crude increased by $25.72 (28.3%) to $116.62 per barrel. This marks the largest one-day price jump in the last four years.
According to market analysts and traders, the rapid price increase is driven not only by military actions but also by prolonged disruptions in tanker passage through the Strait of Hormuz, which accounts for about 20% of global oil supplies, primarily to Southeast Asian countries. Delays and risks in export logistics make Asian buyers particularly vulnerable in the global energy market.
Global Implications for the Energy Market
Iraq and Kuwait have already begun to cut oil production, joining previously announced restrictions on liquefied natural gas exports from Qatar. Experts predict that similar actions may soon be taken by the United Arab Emirates and Saudi Arabia. This further exacerbates the oil shortage in the market and drives prices upward.
“If the flow of oil through the Strait of Hormuz does not resume soon, and regional tensions do not decrease, price pressure is likely to persist,” said Vasu Menon, Managing Director of Investment Strategy at OCBC (Oversea-China Banking Corporation) in Singapore.
The military conflict in the Persian Gulf may lead to consumers and businesses worldwide facing prolonged fuel price increases—even in the event of a swift end to hostilities. Commodity suppliers are forced to contend with bombings of oil facilities, logistical disruptions, and increased risks for maritime transport.
In response to the first wave of strikes by the U.S. and Israel on February 28, Iran’s Supreme Leader Ayatollah Ali Khamenei was killed along with several other high-ranking officials. Iran retaliated with large-scale missile and drone attacks not only on Israel and U.S. military facilities but also on neighboring countries considered U.S. allies by Tehran.
According to statements from the human rights organization HRANA, from the start of the conflict on February 28 to March 3, there were 1,097 civilian deaths and 5,402 injuries, including among children, reported in Iran. There are also reports of strikes on military bases, medical facilities, and residential areas across the country.