Oil prices surge nearly 5% as Trump escalates Iran tensions, lifting Brent, WTI and Bonny Light on fears of global supply disruption
Global oil markets rallied sharply on Monday as oil prices surged nearly five per cent after United States President Donald Trump warned Iran of an imminent naval deployment, fuelling fears of supply disruptions in the Middle East.
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Brent crude, the global benchmark, climbed to $71.62 a barrel, while Nigeria’s Bonny Light crude jumped to as high as $78 a barrel, its strongest level since August last year.
United States benchmark West Texas Intermediate crude gained 4.79 per cent to $66.24 a barrel, breaking above $65 for the first time since September.
The sharp rise followed renewed tensions between Washington and Tehran after President Donald Trump warned that a massive United States Navy armada was heading towards the Persian Gulf, a region central to global oil production and exports.
Markets reacted swiftly as investors priced in heightened geopolitical risk, amid concerns that any disruption to Iranian supply or shipping routes could tighten global crude availability.
“The situation with Iran continues to escalate,” said Josh Young, Chief Investment Officer at Bison Interests.
Josh Young said even a partial reduction in Iranian oil exports would be sufficient to sustain recent price gains and potentially drive further increases if additional supply is threatened.
On the New York Mercantile Exchange, West Texas Intermediate crude for March delivery traded as high as $66.40, its highest intraday level since September 26, before settling near $66.21, according to market data.
Brent futures on ICE Futures Europe rose 4.7 per cent, positioning prices for their highest close since July.
President Donald Trump, in a post on his Truth Social platform, urged Iran to reach a nuclear agreement, warning that “time is running out.”
Iran’s mission to the United Nations responded that Tehran remained open to dialogue but would defend itself forcefully if attacked.
Robert Yawger, Director of Energy Futures at Mizuho Securities USA, said the timeline for potential military action appeared to be narrowing.
Robert Yawger noted that market speculation increasingly points towards targeted strikes on Iranian military and nuclear infrastructure, adding a powerful risk premium to oil prices.
Iran currently produces about 3.3 million barrels of oil per day and has historically maintained output despite repeated geopolitical crises.
However, analysts warn that escalating rhetoric alone is enough to unsettle markets already sensitive to supply risk.
Iranian Foreign Minister Abbas Araghchi said the country’s armed forces were prepared to respond immediately to any aggression, underscoring the volatility surrounding the standoff.
Commenting on the latest developments, ING commodities strategists Warren Patterson and Ewa Manthey said the oil market had become visibly nervous.
Warren Patterson and Ewa Manthey said the aggressive tone from both sides had amplified fears of potential supply disruptions.
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For oil markets, the coming days will test whether diplomatic efforts can ease tensions or whether the current rally gathers further momentum, with implications for inflation, energy security and global economic stability.
