Oil Prices Hit Highest Since 2022 At More Than $119 A Barrel On Iran War

Oil prices surged to over $119 per barrel, the highest since 2022, following the outbreak of war with Iran that has effectively shut down the Strait of Hormuz. The strait is a critical chokepoint for global energy transit, handling about 20% of the world's oil and LNG supply. The conflict has halted most shipping through the waterway, triggering a supply shock. Traders are pricing in a prolonged disruption, with no immediate diplomatic resolution in sight. The escalation marks a major geopolitical crisis in the Middle East, with potential spillover effects on global energy security and inflation. Analysts warn that sustained closures could push prices above $150 per barrel if the conflict expands.

Global Impact

Economic: A sustained oil price spike above $120 will reignite global inflation, forcing central banks to maintain or raise rates, raising recession risks in oil-importing economies. Political: The conflict destabilizes the Middle East, potentially drawing in regional proxies and disrupting broader trade routes.