Oil prices climbed sharply Sunday as markets opened after a spate of attacks in the Middle East disrupted regional energy flows. Traders reacted to U.S. and Israeli strikes on Iran and to retaliatory strikes that have targeted Israel and U.S. military sites around the Gulf, as well as reports of attacks on two vessels transiting the Strait of Hormuz.
The incidents raised fears that shipments from Iran and other Gulf producers could slow or stop, threatening exports through the narrow, globally critical chokepoint. West Texas Intermediate, the U.S. benchmark, was trading around $72 a barrel Sunday night, up roughly 8% from about $67 on Friday, according to CME Group. Brent crude, the international benchmark, was near $79 a barrel, also about 8% higher than Friday’s close of $72.87, per FactSet.
About 15 million barrels per day—roughly 20% of global oil—pass through the Strait of Hormuz, Rystad Energy estimates. The strait, bounded to the north by Iran, is the exit route for oil and gas from Saudi Arabia, Kuwait, Iraq, Qatar, Bahrain, the UAE and Iran. Iran briefly closed parts of the channel in mid-February for what it called a military drill; further disruptions to transit could tighten supply and lift prices.
In response to market worries, eight OPEC+ members said Sunday they would raise crude output. OPEC had already planned a 206,000-barrel-per-day increase in April. Countries announcing production increases include Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria and Oman.
Analysts note that spare production capacity on paper may not ease immediate pressure if exporters cannot move barrels through key routes. Iran exports roughly 1.6 million barrels a day, mostly to China; any interruptions to those flows could force buyers to seek alternate supplies, adding further upward pressure on crude and gasoline prices.