Oil prices climbed sharply on 24 April as renewed fears of escalating hostilities in the Middle East rattled global energy markets and raised concerns over supply disruptions.
By 10:19 GMT, Brent crude futures had risen by US$2.18, or 2.1 per cent, to US$107.25/bbl, while US West Texas Intermediate (WTI) futures climbed US$1.78, or 1.9 per cent, to US$97.73/bbl, according to Reuters.
The surge reflects heightened geopolitical tensions following Iran’s release of footage showing commandos boarding a cargo vessel in the Strait of Hormuz, a critical transit route for global oil shipments.
The Strait of Hormuz, which historically handles around one-fifth of the world’s oil supply, remains largely inaccessible amid ongoing tensions.
Iran’s seizure of two cargo ships has underscored the challenges facing Washington in maintaining secure passage through the strategic waterway, intensifying fears of prolonged supply constraints.
Market sentiment has been further buoyed by the scale of recent gains.
Over the past week, Brent crude futures have risen by 18 per cent, while WTI has climbed 16 per cent, marking the second-largest weekly increase since the onset of the current conflict.
On 23 April alone, both benchmarks closed more than 3 per cent higher amid reports of air defence systems being activated in Tehran and signs of internal political tensions within Iran’s leadership.
Geopolitical developments have also been closely watched following remarks by US President Donald Trump.
He suggested that Iran “may have loaded up its weaponry a little bit” during a temporary two-week ceasefire, but added that “the US military could eliminate it in a single day”.
Trump also indicated a willingness to extend the ceasefire indefinitely to support ongoing peace negotiations.
Addressing questions about the duration of the talks, Trump said “Don’t rush me”, emphasising his intention to secure “a great deal” without committing to a specific timeline for ending hostilities.
His comments have contributed to uncertainty in the market, with investors weighing the likelihood of either a diplomatic breakthrough or renewed conflict.
Analysts warn that the ceasefire may be fragile.
Haitong Futures said in a report that the current pause in fighting increasingly appears to be a precursor to further military action.
The firm noted that if negotiations fail to produce meaningful progress by the end of April and hostilities resume, oil prices could reach new highs for the year.
The broader economic implications are also coming into focus.
Supply disruptions in the Middle East are expected to have ripple effects across global commodity markets, driving up costs and adding inflationary pressure.
Wealth Club chief investment strategist Susannah Streeter highlighted the potential for sustained market strain, stating: “There is set to be fresh financial pain ahead as key shipments from the region remain blocked.
“That is set to keep costs elevated for a vast array of commodities.”
As geopolitical tensions remain unresolved, energy markets are likely to stay volatile, with prices continuing to respond sharply to developments in the region.
