Iran vs US-Israel Conflict Escalates, Global Oil Prices Set to Surge
The United States and Israel launched military operations against Iran on Saturday, 28 February 2026. US President Donald Trump stated that the operation aimed to destroy Iran’s nuclear programme and potentially overthrow the ruling regime.
The move immediately triggered retaliatory strikes from Tehran and risks escalating the conflict across the region. Consequently, global oil markets face significant pressure.
In a statement on social media platform Truth Social, Trump also claimed that Iran’s Supreme Leader, Ali Khamenei, had been killed. However, he provided no further details regarding this claim.
Meanwhile, West Texas Intermediate crude oil, the US benchmark, rose 2.8 percent to above $67 per barrel.
Jorge León, head of geopolitical analysis at Rystad Energy, stated that without signs of de-escalation by the end of the week, oil prices could surge $10 to $20 per barrel when markets reopen Sunday evening.
“Given the scale of the retaliatory strike, strategic initiative now lies largely with Iran. Tehran’s response over the next 24–72 hours, particularly regarding regional energy infrastructure or shipping, will be the primary determinant of short-term oil price dynamics,” he said, according to Yahoo Finance.
According to León, should the conflict expand and target oil infrastructure in the Gulf region, prices could rise further still.
Oman’s foreign minister, who had served as a mediator, previously indicated there was “progress” and potential for an agreement. However, negotiations ultimately failed.
Iran responded by launching missiles at US military assets and infrastructure across several Gulf nations, including Bahrain and the United Arab Emirates. Regional media reports indicate that Saudi Arabia’s capital, Riyadh, and its oil-rich eastern provinces were also targeted.
Several aviation facilities, including Kuwait International Airport and Dubai International Airport, were reportedly struck. US military bases in the region, including Al Udeid in Qatar, were also reported to have been affected.
In Tehran, the United States reportedly attacked the complex serving as the primary residence of Ayatollah Khamenei.
Iran maintains strategic influence over the Strait of Hormuz. The Iranian Revolutionary Guards reportedly warned via radio that no vessels would be permitted to transit the Strait of Hormuz.