Oil Price Rally After Iran Strikes Pushes Markets Higher

In a dramatic escalation of the US-Iran conflict, global oil prices skyrocketed on March 2, 2026, with Brent crude jumping 13% to $82.37 per barrel—the highest level in 14 months—amid fears of severe supply disruptions through the Strait of Hormuz.

The surge follows joint US-Israeli strikes on Iran that reportedly killed Supreme Leader Ayatollah Ali Khamenei, prompting fierce Iranian retaliation.

Iran's Islamic Revolutionary Guard Corps (IRGC) issued warnings closing the strait to international navigation, broadcasting via radio and VHF that "no ship is allowed to pass." Though Tehran has not formally declared a full blockade, tanker traffic has largely halted, with hundreds of vessels anchoring or rerouting.

• Oil prices surge 13% to 14-month high after Iran tanker attacks
• Strait of Hormuz tensions trigger fears of global supply shock
• Brent crude jumps above $82 amid escalating US-Iran conflict

The critical chokepoint handles about 20% of global oil supply and significant LNG volumes, mainly from Qatar. Major oil companies, traders, and tanker owners—including Hapag-Lloyd and CMA CGM—have suspended shipments, while marine insurers paused coverage for the area. Analysts warn that prolonged closure could block up to 20 million barrels per day, potentially pushing oil prices toward $100.

A key incident intensified market panic: the Palau-flagged oil tanker Skylight was struck about five nautical miles north of Khasab Port near Oman in the Strait of Hormuz. Four crew members were injured and required medical treatment. All 20 crew—15 Indian nationals and five Iranians—were safely evacuated, according to Oman's Maritime Security Centre. The attack occurred amid broader Iranian missile strikes on US forces, Gulf targets, and ports like Duqm in Oman.

US WTI crude rose nearly 7% to $71.68 per barrel, after peaking higher earlier. Asian refiners and governments are urgently reviewing stockpiles, while OPEC+ approved a modest output increase of 206,000 barrels per day for April—unlikely to offset disruptions.

Experts like ANZ's Daniel Hynes noted the "significantly increased" threat to supplies from tanker attacks. RBC's Helima Croft cautioned that spare capacity would be "severely limited" if waterways remain inoperable. Citi analysts suggested regime change or leadership shifts could end hostilities in one to two weeks.

Also Read: International Reactions Vary Amid US-Israel Strikes on Iran

The crisis has also disrupted flights, closed airspaces, and raised global economic risks, with stock markets under pressure. As the Middle East teeters on wider war, energy markets brace for further volatility.