Oil prices climbed above 90 dollars a barrel after Saudi Arabia joined the United States in launching airstrikes against Iran backed groups in Iraq, heightening fears of a wider Middle East conflict and renewed concerns over global crude supply.
Brent crude surged more than 7 percent to 90.25 dollars a barrel while US benchmark crude rose 6.8 percent to 84.65 dollars, extending gains as tensions escalated following coordinated US-Saudi strikes against Iranian backed militias blamed for drone attacks on Saudi oil facilities, shortly after the US military said it had thwarted a surprise Iranian missile attack on American troops in the region. President Donald Trump vowed a forceful response to Tehran, telling reporters Iran would face a serious beating for its latest actions.
The renewed hostilities placed the Strait of Hormuz, through which roughly a fifth of the world’s seaborne oil passes, back at the center of market concerns, with Iran rejecting a proposal from Oman for joint regional management of the waterway. China meanwhile held direct talks with Yemen’s Houthi movement to secure safe passage for its tankers through the Red Sea after the group declared a blockade of Saudi ports. The US also announced fresh sanctions targeting Iran linked tankers, with Treasury Secretary Scott Bessent saying Washington would not allow Iran to hold global commerce hostage to finance its activities abroad.
Analysts said Brent crude was likely to remain highly volatile, forecasting a trading range between 80 and 100 dollars as the conflict evolves, with fresh data showing US crude inventories fell sharply last week to their lowest level since 2018, pointing to resilient demand. The bullish sentiment was reinforced by expectations that OPEC+ could pause planned production increases for several months once it completes its current schedule for restoring previously withheld output.
