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Oil prices are surging at a pace not seen in years, rattling global markets as the war in the Middle East fuels fears of a major energy supply crisis.
Early Monday, the price of West Texas Intermediate crude oil jumped about 30%, reaching roughly $118 a barrel. At the same time, Brent crude oil, the global benchmark, climbed more than 27% to about $118.
The sudden spike is being driven by growing panic in energy markets over the ongoing conflict in the Middle East and the effective shutdown of the Strait of Hormuz, one of the world’s most critical shipping routes for oil and natural gas.
Roughly 20% of the world’s seaborne oil and liquefied natural gas normally passes through the narrow waterway between the Persian Gulf and the Gulf of Oman. With shipping routes now disrupted, traders are scrambling to secure supplies, pushing prices sharply higher.
The speed of the surge has shocked analysts. Even during the Russian invasion of Ukraine, when oil briefly climbed above $130 per barrel, markets did not experience such sudden turbulence.
The energy shock is already rippling through financial markets. Stock indexes in Asia dropped sharply as investors reacted to the growing uncertainty. Japan’s Nikkei 225 fell more than 6%, while South Korea’s KOSPI slid nearly 6.5%.
Natural gas prices are also rising, with short-term U.S. futures gaining about 7% as energy traders brace for possible supply disruptions.
The surge comes on the tenth day of the conflict, with markets closely watching developments that could determine whether the crisis spreads further across global energy routes.
For consumers, the surge could soon translate into higher fuel and energy prices, raising fears of another global inflation shock just as many economies were beginning to stabilize.
