Oil prices surged more than 9% early Friday, reaching their highest levels in nearly five months, following Israeli strikes on Iran’s nuclear facilities, a move that significantly intensified geopolitical tensions in the Middle East and raised fears of supply disruptions.
- Brent crude futures rose by $6.29 or 9.07%, to $75.65 a barrel by 0315 GMT, after touching an intraday high of $78.50, the highest since January 27.
- U.S. West Texas Intermediate (WTI) gained $6.43 or 9.45%, to $74.47, after peaking at $77.62, its loftiest since January 21.
These moves mark the largest intraday gains for both benchmarks since 2022, when Russia’s invasion of Ukraine sent energy markets into turmoil.
Israel announced that it targeted Iran’s nuclear infrastructure, ballistic missile factories, and senior military figures in what it called the beginning of a prolonged campaign aimed at halting Tehran’s nuclear ambitions.
“This has elevated geopolitical uncertainty significantly and requires the oil market to price in a larger risk premium for any potential supply disruptions,” wrote Warren Patterson and his team at ING.
Analysts warn that any retaliatory moves by Iran or disruption to Strait of Hormuz traffic could send oil prices even higher, with markets now pricing in a rising geopolitical risk premium.
