Crude oil prices climbed above $110 per barrel on Tuesday as the ongoing U.S.-Iran conflict continued to disrupt global energy supply and reinforced bullish sentiment across oil markets.
Brent crude oil, the international benchmark for Nigerian crude oil, rose to about $110.55 per barrel, while U.S. West Texas Intermediate (WTI) traded near $98.17.
The surge in prices is being driven primarily by the prolonged disruption of the Strait of Hormuz, a critical shipping route that accounts for roughly 20% of global oil and gas flows.
The waterway remains largely restricted as tensions persist, limiting the movement of crude from key Middle Eastern producers to global markets.
Diplomatic efforts to resolve the conflict have shown little progress as reports indicate that proposals aimed at easing tensions have failed to address core issues, leaving negotiations stalled and prolonging uncertainty in energy markets.
The supply shock has introduced a significant risk premium into oil pricing with analysts warning that crude could remain elevated within the $100 to $125 per barrel range if disruptions continue.
The impact of rising oil prices is already being felt across global markets. Oil-sensitive currencies have weakened, while inflation concerns are intensifying as higher energy costs filter into transportation, manufacturing, and consumer goods pricing.
Market participants also note that the ongoing conflict, now entering its second month, has fundamentally altered supply dynamics, forcing traders and producers to adjust expectations and pricing models.
Despite the rally, analysts caution that oil markets remain highly volatile and headline-driven. Any breakthrough in diplomatic negotiations could ease supply concerns and trigger price corrections, while further escalation may push prices higher.
Overall, crude oil remains firmly supported by geopolitical risk, with the Iran conflict and disruption to key supply routes continuing to dictate market direction in the near term.