Global Crude Oil Prices Surge Amid Middle East Conflict

Brent crude futures have jumped 22% this week, putting them on track for the biggest weekly surge since February 2022, when they gained 25.4%. The conflict in the Middle East has disrupted energy markets, with maritime traffic in the Strait of Hormuz grinding to a near-complete halt.

Oil markets have been rocked by the conflict, which has ensnared about a dozen nations since the United States and Israel launched their campaign on 28 February. Prices have been marching higher since late December, strengthening by 50% so far. The last time Brent showed a similar rally was between November 2021 and March 2022, when it jumped 68.5% in just five months.

Market Outlook

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The ongoing US–Iran conflict has led to the closure of the Strait of Hormuz, disrupting energy flows to global markets and prompting producers to begin shutting in output. Goldman Sachs warned that a prolonged disruption at the Strait of Hormuz could push prices significantly higher, flagging the risk of oil topping $100 per barrel if disruptions persist.

Price Projections

Qatar's energy minister told the Financial Times that crude prices could soar to $150 a barrel within two to three weeks if tankers and other merchant vessels remain unable to pass through Hormuz. The US has allowed India to temporarily increase its purchases of Russian oil, while Saudi Arabia raised oil prices for Asian buyers and redirected shipments through Red Sea ports to bypass the Strait of Hormuz.

Key Statistics

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• 22%: Brent crude futures gain this week
• 25.4%: Biggest weekly surge in Brent crude futures since February 2022
• 50%: Brent crude price increase since late December
• 68.5%: Brent crude price increase between November 2021 and March 2022
• $100 per barrel: Potential oil price if disruptions persist, according to Goldman Sachs
• $150 a barrel: Potential oil price within two to three weeks, according to Qatar's energy minister