Global oil markets rose more than 2 per cent on Monday after renewed military exchanges between Iran and the United States, alongside intensified fighting involving Israel and Hezbollah in Lebanon, heightened fears of wider regional disruption.
US crude futures increased by $2.29, or 2.62 per cent, reaching $89.65 per barrel by 0436 GMT. Brent crude futures also advanced, gaining $2.05 or 2.25 per cent to settle at $93.17 per barrel.
The rise followed reports of fresh strikes and counter-strikes between the US and Iran, which weakened expectations of an imminent extension to a ceasefire agreement that had previously helped push oil prices lower.
According to US officials, American forces carried out “self-defence strikes” over the weekend targeting radar and drone control systems in Iran, including sites in Goruk and Qeshm Island. The strikes were described as a response to what Washington called “aggressive actions” from Tehran.
In response, Iran’s Islamic Revolutionary Guard Corps (IRGC) said its aerospace forces had launched attacks on a military air base allegedly used in earlier US operations involving a telecoms tower on Sirik Island.
The renewed hostilities come at a time when diplomatic efforts to extend a fragile ceasefire between the two sides remain uncertain. US President Donald Trump said on Friday that a decision on extending the truce would be made soon, giving negotiators more time to pursue a longer-term settlement over Iran’s nuclear programme.
Meanwhile, tensions also persist in Lebanon, where Israel has ordered troop movements deeper into areas controlled by Hezbollah, further complicating peace efforts in the region.
Market analysts warned that risks to global supply routes remain elevated, particularly regarding the Strait of Hormuz, through which a significant share of global oil shipments passes. Concerns that the waterway could face disruptions or mining activity have added to price volatility.
Despite weaker economic indicators from China, including slowing factory output and export contraction, geopolitical risks dominated market sentiment. Analysts noted that even if a diplomatic breakthrough is reached, any resulting supply relief is likely to be gradual rather than immediate.
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