New York: Oil prices surged sharply on Monday as escalating conflict in the Middle East raised fears of prolonged supply disruptions, while global stock markets tumbled amid growing economic uncertainty.
The main US benchmark, West Texas Intermediate (WTI), jumped more than 30 percent in early trading. At 0230 GMT, WTI traded at $107.21 per barrel after briefly touching $118.88. Meanwhile, Brent crude down to $107, after hitting an intraday high of $118.73.
Since the conflict began on February 28, WTI prices have risen more than 75 percent and Brent has gained over 60 percent, reflecting escalating concerns about energy supplies.
Markets react as conflict disrupts energy flows
Oil prices spiked as Iran launched retaliatory strikes on energy facilities in Gulf states following US-Israeli military operations. Reports indicated attacks on oilfields in southern Iraq and the autonomous Kurdistan region, forcing a US-operated oilfield to halt production.
Moreover, the United Arab Emirates and Kuwait started reducing output, further tightening supply. At the same time, maritime traffic through the Strait of Hormuz — a route carrying about one-fifth of global oil and gas shipments — has remained halted since the war erupted.
Consequently, investors rushed toward safer assets. The US dollar strengthened while equity markets across Asia plunged sharply.
Seoul’s Kospi index fell nearly eight percent at one stage, while Tokyo’s Nikkei dropped seven percent and Taipei declined more than five percent. Similarly, markets in Hong Kong, Shanghai, Sydney, Singapore, Manila and Wellington also recorded steep losses.
Inflation worries deepen as investors flee risk assets
Rising energy prices have intensified fears of renewed inflation that could slow global economic growth. Higher oil costs may also limit central banks’ ability to cut interest rates to support economies.
Stephen Innes of SPI Asset Management warned that the crisis reflects a real supply shock rather than temporary market panic.
However, US President Donald Trump downplayed the surge, saying higher oil prices represent a “very small price to pay” for eliminating Iran’s nuclear threat and restoring long-term security.
