Global oil prices have surged above $100 (€86, £74, AUD142) per barrel for the first time since 2022, as the fallout from the war between the United States (US) and Israel with Iran continues to knock 20 million barrels of oil off the market every day, the British newspaper The Guardian reports.
A weekend marked by escalating violence in the Middle East has further heightened concerns about a prolonged supply disruption, pushing oil prices to their highest levels in four years and sparking a sharp sell-off in stock markets.
At least five energy facilities in and around Tehran were hit in the attacks, leading to descriptions of "apocalyptic" scenes in the Iranian capital. Kuwait's national oil company also said it had cut production as a precaution in the wake of Iranian retaliatory attacks.
The Strait of Hormuz - one of the world's most important trade arteries, through which about a fifth of the world's oil and liquefied gas tankers transported by sea usually pass - has been virtually closed for a week.
Brent crude, the international benchmark, jumped 26,3 percent to $117,08 a barrel in early trading in Asia-Pacific markets at the start of the new week, marking the first time market prices have crossed this key psychological threshold since Russia's invasion of Ukraine.
The benchmark price of US crude oil West Texas Intermediate (WTI) also rose sharply, jumping 28,7 percent to $119,96 per barrel.
The extraordinary jump in oil prices represents a "very small price" that the United States "and the world" are paying for "security and peace", US President Donald Trump said on Sunday, describing it as a "short-term" consequence of the US-Israeli war against Iran. They will "fall sharply when the destruction of the Iranian nuclear threat is complete", the US president claimed on social media.
The Iranian regime has warned that US-Israeli attacks risk pushing prices further up.
"If you can handle an oil price of more than $200 per barrel, continue this game," a spokesman for the Iranian Revolutionary Guard Corps (IRGC) said after the attacks on energy facilities.
Japan's Nikkei 225 index fell 7,4 percent in Tokyo on Monday, signaling another turbulent week for global stock markets, while South Korea's Kospi plunged 7,4 percent. Australia's ASX 200 fell 4,1 percent in Sydney. Premarket trading data suggested Wall Street would open lower.
Oil prices have returned to triple digits after their biggest weekly gains since the Covid pandemic six years ago, including a $10 jump in US crude on Friday alone.
"The period of tolerance that the market gave the Trump administration expired at the end of last week," said Clayton Siegel, a senior fellow at the Center for Strategic and International Studies.
"A 20 million barrel per day shortfall is affecting the balance of the global oil market with no sign of relief. On the contrary, President Trump is demanding unconditional surrender, a highly unlikely outcome. While observers may have initially thought his ignoring of painfully high oil prices was a bluff, it is now clear that it was not," he said.
The Trump administration has been trying to reassure investors in recent days with messages that the recent disruptions in the oil and gas industry will not last long.
"In the worst case, this is a matter of weeks, not months," US Energy Secretary Chris Wright told CNN on Sunday.
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