Crude oil prices rallied sharply on Monday to their highest levels since January amid renewed supply concerns following coordinated military action by the United States and Israel targeting Iran’s key nuclear facilities over the weekend.
Brent crude oil, against which Nigerian crude oil is priced, gained 72 cents or 0.93% to close at $77.73 per barrel at 09:06 a.m. in Nigeria while U.S. West Texas Intermediate (WTI) crude advanced 71 cents or 0.96% to $74.55 per barrel.
The price jump followed confirmation from U.S. President Donald Trump that American forces had “obliterated” Iran’s main nuclear installations, joining Israel’s offensive in a marked escalation of the conflict in the Middle East. Iran, a key member of the Organization of the Petroleum Exporting Countries (OPEC) and the bloc’s third-largest producer, has vowed to retaliate.
“The risks of damage to oil infrastructure in the region have multiplied,” said June Goh, senior analyst at Sparta Commodities. “Even though there are alternate pipeline routes, any disruption at the Strait of Hormuz would affect a significant portion of global crude exports.”
Approximately 20% of the world’s crude oil passes through the Strait of Hormuz, making it one of the most critical chokepoints for global energy security. Analysts warn that any sustained military activity around the strait could result in shipping disruptions and reduced export volumes.
Market sentiment remains sensitive to further geopolitical developments. Sugandha Sachdeva, founder of New Delhi-based SS WealthStreet, noted that “Brent prices could spiral toward $100, with $120 per barrel appearing increasingly plausible depending on Iran’s response.”
Goldman Sachs stated in a research note that Brent could temporarily spike to $110 per barrel if the Strait of Hormuz experiences a 50% export disruption over a one-month period. The bank, however, still assumes no prolonged impact on oil and gas supply as global actors work to avoid an extended disruption.
Brent crude has climbed approximately 13% since the latest round of conflict began on June 13, while WTI is up around 10%. Traders are now closely watching Iran’s next steps, particularly after Tehran warned that the weekend’s airstrikes had expanded the range of legitimate targets for retaliation.
Iranian state media also quoted senior officials referring to President Trump as a “gambler,” accusing Washington of entering the war unprovoked.
While Western markets reacted cautiously, energy import-dependent economies in Asia expressed concern. Japan issued a call for restraint, and South Korea’s Vice Industry Minister warned of the potential economic impact of continued hostilities on regional trade flows.
Russian President Vladimir Putin is also expected to meet Iranian Foreign Minister Abbas Araqchi in Moscow on Monday to discuss diplomatic options.
In the interim, risk premiums in the oil market are expected to remain elevated. “The underlying concern is not only about immediate supply shocks but the potential for broader regional instability,” Goh added.
