Oil prices shot up on Monday morning after Iran fired missiles at Israel for the first time since the fragile ceasefire agreed in April, sending the global benchmark Brent to $95.50 a barrel. The price jumped 2.6% in Asian trade, while US crude rose 2.5% to $92.75, as markets absorbed the implications of the attack. Iran’s Islamic Revolutionary Guard Corps warned that the strikes are the start of “a full week” of attacks, raising fears of a return to all-out conflict in the Middle East.
Just hours earlier, US President Donald Trump told Axios he would urge Israel not to retaliate. “I am going to call Bibi right now and tell him not to retaliate,” Trump said, referring to Israeli Prime Minister Benjamin Netanyahu. “We are very close to a final deal with Iran. It is going to be a good deal. I don’t want it to blow up because of what is happening now.” Despite the plea, Israel’s military has said it will “strike the enemy” as soon as the order is given.
“Oil jumps 2.6% as Iran fires missiles at Israel, breaking April ceasefire; Trump urges no retaliation.”
The ceasefire, in force since 17 April, has been violated repeatedly by both Israel and Iran. Oil prices have been on a knife-edge since US and Israel launched strikes on Iran on 28 February, triggering huge swings in crude markets. Prices have hovered around the $95 mark over the past week as traders weighed the long-term impact of the conflict on global energy flows.
The latest escalation threatens to disrupt oil and gas shipments from the Gulf. Iran has threatened to strike vessels that attempt to cross the critical Strait of Hormuz trade route in retaliation for the US-Israeli attacks. With Iran now promising a full week of strikes and Israel vowing to retaliate, the ceasefire that had held – however shakily – appears to be unravelling, leaving markets bracing for further volatility.