Global oil prices surged above $100 per barrel on Sunday, marking the first time in nearly four years, amid fears that the escalating Middle East conflict could trigger prolonged supply disruptions. Both West Texas Intermediate (WTI) and Brent crude jumped more than 15 percent, reaching levels last seen during the early months of Russia’s 2022 invasion of Ukraine. The spike comes as maritime traffic through the Strait of Hormuz, which handles 20 percent of global oil and gas, has largely halted since February 28.
US President Donald Trump dismissed the surge as a “small price to pay” to neutralize Iran’s nuclear threat, asserting that oil prices would drop rapidly once the conflict resolves. Trump emphasized that short-term increases are temporary and framed them as a necessary cost for global safety and peace.
The conflict has prompted Gulf oil and gas producers to cut output, while Israeli strikes on fuel depots in Tehran have raised fears of retaliatory attacks on regional infrastructure. Rising crude prices are already pushing up fuel costs in the United States, a politically sensitive issue as midterm elections approach.
US Energy Secretary Chris Wright reassured that the supply disruption is expected to be short-lived, likely lasting only weeks rather than months. He noted that the Western hemisphere is well supplied with oil and that early tanker movements through the Strait of Hormuz may be protected by the US military to ensure the resumption of maritime traffic.
Meanwhile, US authorities are taking steps to mitigate supply risks. Treasury Secretary Scott Bessent indicated the government may lift sanctions on additional Russian oil, following temporary authorization for India to purchase from Moscow. The US International Development Finance Corporation announced a $20 billion reinsurance mechanism to cover risks associated with shipping through the Strait of Hormuz.