London: Global oil prices climbed to their highest level in about a month on Tuesday as the military conflict between the United States and Iran intensified, raising fears of major disruptions to oil supplies from the Middle East. Investors across global markets are closely watching the situation, particularly around the Strait of Hormuz, one of the world's busiest energy shipping routes, where fresh attacks have increased concerns over the safe movement of oil tankers.
Brent crude, the international benchmark for oil prices, rose by more than two percent to trade at around 85 dollars a barrel, while United States West Texas Intermediate crude climbed above 79 dollars a barrel. The increase came after crude prices recorded their biggest single day gain in several years during the previous trading session, reflecting growing anxiety that the conflict could have a serious impact on global energy supplies.
The latest surge follows an escalation in military action between Washington and Tehran. The United States has expanded its military operations against Iran and strengthened naval deployments in the Gulf region. Iran has responded with missile and drone attacks, while fighting has spread to key maritime areas. The situation has become even more tense after Iranian missiles reportedly struck two oil tankers near the United Arab Emirates, killing one Indian sailor and injuring eight others. The incident has raised fresh concerns about the safety of commercial shipping in one of the world's most important oil transport corridors.
The Strait of Hormuz remains at the centre of global attention. Around one fifth of the world's daily oil supply passes through the narrow waterway, making it one of the most strategically important routes for international energy trade. Although the strait has not been officially closed, shipping companies have become increasingly cautious as military activity in the region continues. Higher insurance costs, possible delays and fears of further attacks have all contributed to the sharp rise in crude prices.
Market analysts say the current rally is driven mainly by concerns over supply rather than demand. Traders believe that any prolonged disruption to oil exports from the Gulf could tighten global supplies and push prices even higher. Some experts have warned that if the conflict worsens or if the Strait of Hormuz is significantly disrupted, Brent crude could move towards 100 dollars a barrel in the coming weeks.
The rise in oil prices has also affected global financial markets. Stock markets in Asia traded cautiously, while investors on Wall Street remained concerned that higher energy costs could increase inflation and slow economic growth. Rising fuel prices could also influence future decisions by major central banks, including the United States Federal Reserve, on interest rates.
The impact is expected to be particularly significant for countries that depend heavily on imported crude oil. India, which imports more than 85 percent of its crude oil requirement, could face higher fuel import costs if prices remain elevated. A prolonged increase in global oil prices may eventually lead to higher petrol and diesel prices, increased transportation costs and greater inflationary pressure. Industries such as aviation, logistics and manufacturing are also likely to face higher operating expenses.
Energy experts say markets will continue to react to every new development in the Middle East. Investors are closely monitoring military operations, tanker movements through the Strait of Hormuz, United States crude inventory data and any diplomatic efforts that could reduce tensions. At the same time, decisions by OPEC and its allies on future oil production will also influence the direction of global crude prices.
While there is still hope that diplomatic efforts could prevent a wider regional conflict, uncertainty remains high. Until there is a clear sign of de escalation between the United States and Iran, oil markets are expected to remain highly volatile, with prices likely to react sharply to every new development in the Gulf region.