Oil Prices Surge Past $108 as Middle East Tensions Shake Global Markets

Global oil markets staged a sharp rebound on Thursday, with benchmark crude prices posting their strongest gains in weeks as geopolitical tensions in the Middle East intensified and hopes for a swift resolution to the conflict faded.

Brent crude futures climbed 5.7%, settling at $108.01 per barrel, while U.S. West Texas Intermediate (WTI) crude rose 4.6% to close at $94.48 per barrel. The rally marks a decisive recovery from losses recorded in the previous session, driven largely by mounting uncertainty surrounding the ongoing conflict involving Iran and escalating military activity in the region.

Latest Oil Prices:

WTI Crude $94.04 -0.44 -0.47%

Brent Crude $107.2 -0.81 -0.75%

Murban Crude $111.8 +6.45 +6.12%

Gasoline $3.111 -0.019 -0.61%

Heating Oil $4.263 -0.011 -0.25%

WTI Midland $97.47 +4.25 +4.56%

Opec Basket $117.0 -28.28 -19.47%

Indian Basket $157.0 +7.11 +4.74%

Natural Gas $2.965 -0.034 -1.13%

Trading volumes for front-month Brent contracts fell to their lowest level since late February, just before military strikes by the United States and Israel on Iran, highlighting a cautious market grappling with conflicting narratives and fragile sentiment.

Diplomatic signals offered little clarity. U.S. special envoy Steve Witkoff confirmed that Washington had submitted a 15-point proposal to Tehran as a potential framework for negotiations aimed at ending the war. However, Iran’s response has been measured. Foreign Minister Abbas Araghchi acknowledged that the proposal is under review, though no formal talks have begun.

A senior Iranian official, speaking to Reuters, dismissed the proposal as “one-sided and unfair,” underscoring the deep divisions that continue to stall diplomatic progress. Meanwhile, U.S. President Donald Trump suggested that Iran had floated a goodwill gesture, allowing ten oil tankers to pass through the Strait of Hormuz, but the claim has yet to translate into tangible de-escalation.

Market analysts say the lack of coherent messaging is fueling volatility. “There is significant confusion and frustration regarding the credibility of statements coming from both Washington and Tehran,” said Timothy Snyder, chief economist at Matador Economics. “Investors are increasingly shifting toward safe-haven assets in an effort to preserve capital.”

Military developments are further complicating the outlook. According to sources cited by Reuters, the Pentagon is preparing to deploy thousands of paratroopers to the Gulf, providing the White House with broader options for potential ground operations. Two Marine battalions are reportedly already en route to the region.

Adding to supply concerns, Yemen’s Houthi movement, aligned with Iran, has signaled its readiness to resume attacks on critical shipping lanes in the Red Sea, raising the specter of further disruptions to global energy flows.

“The ongoing military escalation, including troop deployments and renewed strikes, combined with restricted tanker movement under strict Iranian conditions, continues to exert pressure on global energy markets,” said Sujin Kim, an analyst at MUFG Bank.

The conflict has already had a profound impact on energy infrastructure. Shipments through the Strait of Hormuz, a vital artery responsible for roughly one-fifth of global crude oil and liquefied natural gas flows, have nearly ground to a halt. The International Energy Agency has described the situation as the most significant disruption to oil supplies on record.