Recent clashes involving Iran, Israel, and the United States have triggered a dramatic spike in international crude oil prices, raising concerns over rising energy costs worldwide. Over the past three days, both Brent and West Texas Intermediate (WTI) crude have surged by roughly 13 per cent, signalling heightened volatility in global energy markets.
The crisis escalated on 28 February, when a military strike in Tehran intensified regional tensions to unprecedented levels. Oil markets had already begun reacting on the preceding day, reflecting investor anxiety. According to reports from AFP, on 27 February, Brent crude opened at $72 per barrel and closed at $82, while WTI started at $60 per barrel and finished above $70.
Crude Oil Price Movements (Per Barrel)
| Crude Type | 27 Feb (Opening) | 27 Feb (Closing) | Daily Increase (%) | Total Rise by 28 Feb (%) |
|---|---|---|---|---|
| Brent | $72 | $82 | 13.9% | 13% |
| WTI | $60 | $70 | 16.7% | 13% |
On the day of the attack, Iran declared a suspension of all shipping through the Strait of Hormuz, a strategic waterway connecting the Arabian Sea to the Persian Gulf. Nearly 20 per cent of the world’s daily oil supply passes through this narrow channel, making it a critical artery for international energy trade.
Officials and analysts at Rystad Energy warned AFP that even if alternative shipping routes are used, daily oil supply could drop by 8–10 million barrels, placing significant upward pressure on global prices.
Market analysts caution that prolonged disruption could have far-reaching consequences. Energy-intensive industries, transport sectors, and export-dependent economies are particularly vulnerable to such shocks. Beyond retail prices, the surge in crude costs could directly impact production and international trade, posing challenges to economic stability.
International economic agencies have stressed the importance of maintaining free and secure passage through the Strait of Hormuz. Without it, energy price volatility may intensify, affecting markets and consumers worldwide.
With military tensions persisting and a key shipping route effectively closed, global crude markets are experiencing significant instability. Observers warn that unless the geopolitical situation stabilises, further oil price hikes may be inevitable, creating additional strain on the already fragile international economy.