Oil Prices Surge More Than 8% on Fears of Iran War

Oil traders jolted awake Sunday night as crude prices leapt more than 8% on fears that a widening US-Iran conflict could choke a crucial energy artery, CNBC reports. By early evening, US benchmark West Texas Intermediate was up $5.55 at $72.57 a barrel, while global benchmark Brent crude surged about 9% to $79.41. The jump followed extensive US and Israeli airstrikes in Iran that killed Supreme Leader Ayatollah Ali Khamenei and senior officials, throwing the country's political future—and its oil sector—into uncertainty.

Analysts say the real test is what happens at the Strait of Hormuz, the narrow passage that handles roughly a third of the world's seaborne crude, much of it bound for Asian buyers. Tanker movements there have largely stalled as shippers pull back, according to energy consultancies. The BBC reports at least two ships have also been hit in strikes near the Strait of Hormuz, with a projectile exploding very close to a third, as Iran launches retaliatory strikes across the region.

UBS and Barclays warned clients that a sustained disruption and Iranian retaliation could push Brent toward $100 a barrel—or higher in a severe supply shock. Iran, OPEC's fourth-largest producer at about 3.3 million barrels a day, also faces risks from internal unrest and possible labor strikes. President Trump said combat operations would continue until US objectives are met but added that Tehran "wants to talk," leaving a potential off-ramp that markets are watching closely. Meanwhile, Axios warns gas prices could go up in the US.