Oil prices climbed in early trading following Iran’s missile strikes on Israel, marking the first attacks since an April ceasefire and raising immediate concerns about Middle East supply disruptions. Iranian officials declared these strikes represent the beginning of “a full week” of planned military operations, significantly escalating regional tensions in the world’s most critical oil-producing zone.
The attacks triggered immediate responses across energy markets, with Brent crude and WTI futures both posting gains as traders priced in heightened geopolitical risk premiums. Market participants are closely monitoring potential retaliatory measures from Israel and whether the conflict could threaten vital shipping routes through the Strait of Hormuz, through which roughly one-fifth of global oil supplies transit daily.
Energy sector equities are seeing increased volatility, while safe-haven assets including gold and the US dollar are strengthening. Traders should anticipate continued price swings as the situation develops throughout the week.
FXnCO Insight
Position for sustained volatility in crude oil markets and consider hedging energy exposure as Iran’s promised week-long campaign threatens further supply risk escalation.
Source: BBC Business