Oil Prices Breach US$100 Again
Global oil prices have once again breached the psychological level of US$100 per barrel for the first time in two months. The surge was triggered by escalating conflict in the Middle East, which threatens global oil supplies.
The Brent crude benchmark jumped from around US$95 per barrel in previous trading to above US$100 on Friday (24/7/2026). Market participants are concerned about disruptions to two of the world’s main oil distribution arteries: the Red Sea and the Strait of Hormuz.
According to The Guardian, the price increase was sparked by attacks from Iran-allied Houthi groups on two Saudi Arabian oil tankers, the Encelia and the Layla, using ballistic missiles, cruise missiles, and drones. One of the vessels was reported to be on fire following the assault. The Houthi group stated the attacks were carried out because both ships were deemed to have violated a naval blockade imposed in the Red Sea region.
Simultaneously, tensions between the United States and Iran regarding the flow of oil shipments through the Strait of Hormuz have escalated again. This situation has raised fears that the two most strategic oil trading routes in the world could face simultaneous disruption.
The market is now pricing in the possibility of oil returning to the US$120 per barrel range if the conflict widens further. These concerns remind market players of last April, when oil prices spiked to around US$126 per barrel due to heated conflict in the Gulf region.
After briefly falling below US$100 at the end of May and even touching the US$71 range in early July amid hopes for a ceasefire, oil prices have crept back up after an initial agreement between the United States and Iran failed to progress and conflict intensified again.
International Energy Agency (IEA) Executive Director Fatih Birol said the oil market has so far been helped by several factors that have managed to dampen price volatility. However, he warned that the escalating conflict means the market cannot afford to be complacent about potential supply disruptions.
The oil price surge has also sparked fresh concerns about global inflation. Investors are beginning to anticipate that rising energy costs could slow the decline in inflation and force central banks to keep interest rates higher for longer.
This sentiment immediately pressured global financial markets. Stock exchanges in the United States and Europe weakened in unison, while investors also sold off government bonds, pushing up sovereign debt yields in several developed nations.
IG market analyst Chris Beauchamp said market volatility is rising again alongside the increased risk of a broader conflict in the Middle East. “Government bond yields continue to rise, which has the potential to put pressure on the economies of developed countries. Volatility has spiked and stock markets are moving deeper into the red as the risk of a full-scale conflict re-emerges,” he said.
Market participants will now closely monitor developments in the Middle East conflict, particularly the security of shipping lanes in the Red Sea and the Strait of Hormuz, given that both are vital routes for global oil trade. Greater supply disruptions could push oil prices even higher and increase the risk of a global economic slowdown due to renewed inflationary pressures.