Global oil prices have increased following the political crisis in Iran. The selection of Mojtaba Khamenei as Iran’s new supreme leader sparked a quick reaction from traders. Therefore, the price of crude oil surged past $105 per barrel and briefly touched $108.
Markets respond to rising geopolitical tensions
According to data from Trading Economics, oil benchmarks moved higher on Sunday as markets reopened. Investors closely watched the situation in Iran and the wider Middle East. Political uncertainty in the region often affects global energy prices.
Brent crude, the international oil benchmark, jumped soon after trading resumed on the Chicago Mercantile Exchange. The price reached $101.19 per barrel. This marked a 9.2 percent increase from Friday’s closing price of $92.69.
Meanwhile, West Texas Intermediate (WTI), the main US crude benchmark, recorded an even stronger rise. WTI traded at around $107.06 per barrel. This represented a 16.2 percent increase compared with its Friday settlement price of $90.90.
Energy analysts said the sharp rise reflected immediate market reactions. Traders often respond quickly to political risks in key oil-producing regions.
Strait of Hormuz worries add pressure
The closing of the Strait of Hormuz has increased pressure on global oil markets. As it is the most important route for global oil shipments, a large share of the world’s crude supply is impacted every day.
Additionally, any instability in this region can escalate prices to an unprecedented level. It has stirred fear among investors that rising tensions could threaten oil transportation through the strait.
However, the stability of the oil market depends on new political or military developments. If tensions ease, prices may stabilize. But the chances remain very low if the instability increases.
