Global oil markets rallied on Thursday, with crude prices jumping nearly seven per cent after U.S. President Donald Trump signaled an intensification of military action against Iran, heightening concerns over potential supply disruptions in the Middle East.
Brent crude futures rose by $7.65, or 7.6 per cent, to settle at $108.81 per barrel, while U.S. West Texas Intermediate (WTI) gained $7.06, or 7.1 per cent, to $107.18 per barrel. The rise marked the largest single-day gain in three weeks, reversing earlier losses and underscoring the volatility gripping global energy markets.
The rally followed a televised address by Trump, in which he indicated that U.S. military operations against Iran would intensify in the coming weeks.
“We’re going to hit them extremely hard over the next two to three weeks,” Trump said, offering no clear indication of diplomatic engagement or a pathway to de-escalation.
The absence of any reference to a ceasefire or negotiations has unsettled markets, with analysts warning that escalating geopolitical tensions could trigger further supply shocks.
Priyanka Sachdeva, senior market analyst at Phillip Nova, noted that markets are reacting to the heightened uncertainty.
“If tensions intensify or maritime risks increase, oil could test fresh highs as markets price in potential supply disruptions,” she said.
One of the chief concerns of the development is the Strait of Hormuz, a critical maritime chokepoint through which roughly a fifth of global oil supply passes. Any disruption to shipping routes in the region could have far-reaching implications for global energy security and pricing.
Recent developments have amplified these fears. On Wednesday, an oil tanker leased to QatarEnergy was reportedly struck by an Iranian cruise missile in Qatari waters, highlighting the growing risks to maritime traffic in the Gulf.
Some traders have already begun to withdraw from transactions tied to the Dubai Middle East benchmark, a pricing mechanism used for a significant portion of global crude exports. Market participants cited concerns that key ports within the Strait may become inaccessible if hostilities escalate further.
