Oil prices surged on Wednesday after Iran launched attacks on energy facilities across the Middle East, intensifying its conflict with the United States and Israel and raising fears of prolonged supply disruptions. The developments were first reported by Reuters.
Oil prices spike amid geopolitical shock
Brent crude rose sharply, climbing 5.6% in post-settlement trading after closing up 3.8% at $107.38 per barrel. U.S. West Texas Intermediate (WTI) also extended gains, rising about 4% after settling at $96.32.
The rally reflects growing concern that attacks on critical infrastructure could significantly tighten global energy supply.
Attacks hit key energy infrastructure
Iran targeted several major energy sites across the Gulf following an earlier strike on its South Pars gas field, one of the world’s largest natural gas reserves.
- Qatar reported extensive damage at Ras Laffan Industrial City, a key energy hub
- Saudi Arabia said it intercepted missiles aimed at Riyadh and a gas facility
- Iran warned that more strikes on regional energy infrastructure could follow
The escalation has already disrupted flows through the Strait of Hormuz, a chokepoint responsible for roughly 20% of global oil and liquefied natural gas supply.
Analysts estimate that 7% to 10% of global oil output — between 7 million and 10 million barrels per day — has been affected by the conflict.
Supply disruptions drive market volatility
The attacks come as global markets were already strained.
Brent prices have been supported by supply risks in the Middle East, while WTI has lagged due to increased U.S. supply, including releases from the Strategic Petroleum Reserve and rising shipping costs.
Still, the widening disruption is pushing prices higher across benchmarks.
“The attacks… and any further escalation would continue to raise prices,” said SEB analyst Ole Hvalbye.
Governments scramble to contain fuel costs
The U.S. government moved to limit the domestic impact of rising energy prices.
- A 60-day waiver of the Jones Act will allow foreign ships to transport fuel between U.S. ports
- Restrictions on summer gasoline blends will be temporarily eased
However, analysts say these measures are unlikely to significantly affect global prices.
Meanwhile, diesel futures in the U.S. surged to a massive premium over crude, signaling tight fuel supply.
Some supply returns, but uncertainty remains
There were signs of partial relief from other regions:
- Iraq resumed exports from the Kirkuk oil fields to Turkey
- Libya redirected flows from the Sharara field after a fire
Even so, traders warn that these additions may not offset the scale of disruption in the Gulf.
Big picture
The market is now being driven less by traditional supply-demand dynamics and more by geopolitical risk.
As long as the conflict threatens critical infrastructure and keeps the Strait of Hormuz effectively closed, oil prices are likely to remain volatile, with further upside risk if attacks continue or expand.