Global oil prices have crossed the $100 mark for the first time in four years as tensions intensify in West Asia, raising serious concerns over global energy supply. The disruption in oil shipments through the strategic Strait of Hormuz and reduced production by major oil-producing countries have pushed crude prices sharply higher.
Brent crude surged to $110 per barrel, marking an 18.03% increase from Friday’s closing price of $92. Meanwhile, U.S. benchmark crude, West Texas Intermediate (WTI), climbed 20.23% to reach $110.40 per barrel. This is the first time oil prices have crossed the $100 level since Russia’s invasion of Ukraine in 2022.
Nearly 20% of the world’s oil supply passes through the Strait of Hormuz, with around 15 million barrels transported daily from West Asia. Following threats from Iran and growing regional instability, oil shipments through the strait have been severely disrupted.
Oil-producing nations such as Kuwait, Iraq, and the United Arab Emirates have reportedly reduced production due to limited storage capacity and uncertainty in supply routes, further tightening global supply and pushing prices upward. Although Saudi Arabia has increased shipments through the Red Sea, it has not been sufficient to compensate for the drop in supplies through the Strait of Hormuz.
The situation has worsened with escalating military actions in the region. Israel recently carried out a major strike on refineries in Iran. In retaliation, Iran’s Islamic Revolutionary Guard Corps (IRGC) reportedly attacked the Bazan Group oil refinery in Haifa Bay, Israel. Iran has also been accused of conducting drone strikes on Gulf oil facilities.
The surge in oil prices has rattled Asian markets. Japan’s Nikkei index fell by 6.22%, while South Korea’s Kospi dropped 6.68% amid growing fears of economic instability and rising energy costs.
Experts warn that if tensions continue to escalate and supply disruptions persist, global markets could face prolonged volatility and higher energy prices.
