Global oil prices surged sharply, with Brent crude climbing above $125 per barrel to reach a wartime high, as escalating tensions between the United States and Iran intensified concerns over supply disruptions. The rally follows reports that the U.S. Central Command is preparing to brief Donald Trump on potential military options against Iran, signaling a possible escalation in the ongoing standoff.
Market sentiment was further impacted by indications that Washington plans to maintain its blockade on Iranian exports, after rejecting Tehran’s proposal to reopen the Strait of Hormuz ahead of renewed nuclear negotiations.
Brent crude futures rose more than 6% to $125.36 per barrel, marking their highest level since mid-2022, while U.S. benchmark West Texas Intermediate (WTI) climbed to nearly $110 per barrel. The sharp increase reflects tightening supply conditions amid continued geopolitical uncertainty.
Analysts attribute the surge to a combination of constrained Iranian exports and reduced shipping activity through the Strait of Hormuz, a critical passage for global energy trade. Reports suggest that oil flows through the route have dropped significantly, adding pressure to already strained supply chains.
Investment banks warn that prolonged disruptions could further tighten the market. Limited storage capacity and restricted exports from Iran may exacerbate supply shortages if the blockade continues, while any increase in output from alternative producers is expected to take time to materialise.
At the same time, some analysts have flagged potential risks on the demand side. Global oil consumption has shown signs of softening in recent weeks, particularly in sectors such as aviation and petrochemicals, which could temper the upward pressure on prices.
The latest surge underscores the fragile balance in global energy markets, where geopolitical developments continue to play a decisive role in shaping price movements. Investors are closely monitoring the situation, as any escalation could trigger further volatility in the coming weeks.
