Global oil markets surged on Monday as tensions between Donald Trump and Iranian leaders intensified over the strategic Strait of Hormuz, raising fears of prolonged disruption to global energy supplies.
Crude prices rose by more than two percent, with Brent briefly climbing above $114 before easing to $109.34 per barrel as of 9:45 AM WAT.
West Texas Intermediate traded between $98.50 and $99.99, while OPEC’s basket price also showed sharp volatility, climbing to about $115.54 per barrel.
The escalation comes amid a deepening Middle East conflict now in its fourth week, with the head of the International Energy Agency warning of a potential global energy crisis.
The agency cautioned that the situation poses a “major threat” to the world economy.
Market analysts say the crisis could trigger a spike in global inflation, potentially forcing central banks to raise interest rates.
There are also growing concerns over food security, as disruptions to fertiliser shipments threaten agricultural production worldwide.
Tensions sharply increased after Trump issued a 48-hour ultimatum to Iran to reopen the Strait of Hormuz — a critical route for roughly one-fifth of global oil and gas shipments — or face severe military consequences.
In a post on Truth Social, the US president warned that Washington would “hit and obliterate” Iranian power plants, “starting with the biggest one first,” if Tehran failed to comply before the stated deadline.
The ultimatum followed Trump’s earlier remarks suggesting he was considering scaling down military operations, but he later ruled out any ceasefire, insisting the United States held the upper hand.
Iran responded with strong warnings, stating the strait “will be completely closed” if the US follows through on its threats.
Parliament Speaker Mohammad Bagher Ghalibaf also warned that any attack on Iran’s infrastructure would trigger retaliatory strikes capable of destroying critical facilities across the region, potentially driving oil prices higher for an extended period.
Meanwhile, regional hostilities continue to intensify. Iranian media reported explosions in Tehran on Monday following a fresh wave of Israeli strikes. Saudi Arabia and the United Arab Emirates also reported new attacks.
Israel signalled further escalation, announcing plans to expand ground operations in Lebanon against the Iran-backed Hezbollah group. A military spokesperson said the country is preparing for “weeks” of continued fighting against both Iran and Hezbollah.
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