Oil Prices Soar Over 9% After Israeli Strikes on Iran Spark Middle East Tensions

Oil prices surged more than 9% on Friday, reaching their highest levels in nearly five months following a dramatic escalation in tensions between Israel and Iran. The sharp rise came after Israel launched airstrikes targeting Iranian nuclear and military sites, prompting fears of potential disruptions to oil supplies across the region.

Brent crude futures rose by $6.29, or 9.07%, to $75.65 a barrel as of 6:15 a.m. Saudi time, after touching an intraday high of $78.50 — the highest level since January 27. U.S. West Texas Intermediate (WTI) crude climbed $6.43, or 9.45%, to $74.47 a barrel, after reaching a peak of $77.62, the strongest since January 21.

The price spike marks the largest single-day intraday move for both benchmarks since 2022, when Russia’s invasion of Ukraine sent energy markets into turmoil.

The Israeli offensive, reportedly named Rising Lion, struck key Iranian targets including nuclear facilities, missile production sites, and military leadership. In response, Iran’s Supreme Leader Ayatollah Ali Khamenei vowed “harsh punishment,” with several senior Iranian military figures confirmed killed in the strikes.

“This has elevated geopolitical uncertainty significantly and requires the oil market to price in a larger risk premium for any potential supply disruptions,” analysts at ING, led by Warren Patterson, noted.

Traders across Asian markets were closely watching developments, with many warning it was still too early to determine the impact on oil shipments. The biggest concern remains whether the conflict will escalate enough to affect the Strait of Hormuz — a vital chokepoint through which nearly a third of the world’s seaborne oil passes.

“If Iran chooses to retaliate by targeting infrastructure or restricting traffic through the Strait, up to 20 million barrels per day could be at risk,” said Saul Kavonic, senior energy analyst at MST Marquee.

In Washington, U.S. Secretary of State Marco Rubio emphasized that the United States was not involved in the Israeli strikes, describing the operation as a “unilateral action.” He urged Tehran to avoid targeting American interests or personnel in the region.

Market fears are also being driven by the potential for broader conflict affecting other oil-producing nations. “Iran’s retaliation could trigger contagion across the region,” said Priyanka Sachdeva, senior analyst at Phillip Nova.

Meanwhile, global financial markets reacted swiftly. Stocks tumbled in early Asian trading, led by a sharp selloff in U.S. futures, as investors rushed to traditional safe havens including gold and the Swiss franc.

With the Middle East once again on edge, energy markets are bracing for further volatility in the days ahead.