Middle East Conflict Pushes Global Oil Prices to Highest Level Since January 2025

NEW YORK, KOMPAS.com — Global crude oil prices surged nearly 5 percent at the close of trading on Tuesday (3 March 2026) local time or Wednesday (4 March 2026) morning WIB, as clashes between the United States-Israel and Iran in the Middle East intensified. Citing Reuters, Brent crude futures rose by $3.66 a barrel, or 4.7 percent, to $81.40 per barrel, the highest level since January 2025. Since the conflict erupted on Saturday (28 February 2026), Brent has risen about 12 percent. Meanwhile, US West Texas Intermediate (WTI) crude rose $3.33 a barrel, or 4.7 percent, to $74.56 per barrel, the highest since June 2025. The situation heightens the risk of global oil supply disruptions. In addition, Iraq, the world’s second-largest oil producer in OPEC after Saudi Arabia, has cut production by almost 1.5 million barrels per day. The cuts could potentially double in the coming days due to storage capacity constraints preventing exports amid the crisis. Iran was also reported to have launched attacks on regional energy infrastructure and tankers in the Strait of Hormuz, a strategic chokepoint through which around one-fifth of the world’s oil and LNG supplies pass. Several tankers and container ships have been avoiding the route after insurers cancelled cover for ships. This has driven shipping rates for oil and gas sharply higher. Market concerns grew after Iranian media reported that Tehran would shoot at any vessel attempting to cross the strait. A Standard Chartered analyst, in a note, said Iran’s response this time is broader than previous steps which tended to be symbolic. Iran’s approach has sparked a regional confrontation that poses real risks to energy supplies, wrote the Standard Chartered analyst. US President Donald Trump said air strikes by the US and Israel were projected to last four to five weeks, though longer could not be ruled out. He also said the US government is considering providing insurance support for tanker ships. ‘Almost everything has been destroyed,’ said Trump, who also predicted that Iran would eventually lose the ability to launch missiles. Meanwhile, Price Futures Group senior analyst Phil Flynn said Trump’s remarks sparked speculation that the conflict could end faster than initially anticipated. ‘Trump said Iran would not sustain this resistance for longer, so the market began thinking there might be a quicker settlement than previously feared,’ Flynn said.