Global oil prices surged more than 4% on Monday after renewed military tensions between the United States and Iran heightened concerns over energy supplies and the security of the Strait of Hormuz.
The latest escalation followed fresh fighting that threatened a fragile truce and renewed fears of disruption along one of the world’s busiest oil shipping routes.
The US military launched a new wave of strikes on Sunday after attacks linked to the conflict targeted several of Washington’s Gulf allies.
The renewed hostilities pushed the two global oil benchmarks up by as much as 4.5%, raising concerns that higher energy costs could fuel inflation and keep interest rates elevated.
Tensions intensified after Iran attacked a commercial vessel in the Strait of Hormuz, forcing its crew to abandon the ship after it caught fire.
Iran’s Revolutionary Guards later declared that the strategic waterway would remain closed until the end of what it described as US intervention in the region. However, the US Central Command (CENTCOM) said the shipping route remained open to lawful maritime traffic.
The uncertainty also weighed on Asian financial markets. South Korea’s Kospi index fell 5%, with technology stocks leading losses, while Japan’s Nikkei 225 also closed lower.
The US dollar strengthened as investors sought safe-haven assets and turned their attention to upcoming earnings reports from major technology companies and Wall Street banks for fresh signals on the global economic outlook.
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