On Friday, ICE Brent crude prices surged more than 8%, peaking at a 13% intraday gain.
This was because Iran launched a barrage of missile strikes on Israel, retaliating for Israel’s targeted assault on Iranian nuclear and military infrastructure.
The sudden escalation further rattled energy markets, which were already grappling with rising geopolitical risks across the Middle East.
The Iranian strike, which Israeli officials said involved up to 150 ballistic missiles in two waves, targeted multiple sites across Israel, according to the Jerusalem Post.
However, Israeli defense forces said they had successfully intercepted several of the projectiles, even though casualties climbed to at least 40 injured, with two in critical condition.
Israeli Defense Minister Yoav Gallant responded shortly after the Iranian retaliatory strikes, saying Tehran had crossed a red line by targeting civilian areas. He vowed a severe response.
The Iranian attack came just hours after Israel unleashed a historic and unprovoked operation, codenamed “Rising Lion,” in which over 100 high-value Iranian targets were struck.
Reports from credible sources show the Israeli aerial targets included critical uranium enrichment facilities at Natanz and Fordow, the Parchin military complex, and numerous IRGC command centers.
Several senior Iranian commanders, including key figures in the Quds Force and IRGC Aerospace Force, were reportedly killed.
Though Iran’s oil infrastructure remains untouched for now—aside from a major gas field and its main port, which have been bombed—heightened risks have already pushed oil prices higher, threatening future supply.
Moreover, there is now fear of a potential disruption to the Strait of Hormuz, where 15–20% of the world’s oil trade flows, adding further concern to energy markets.
A former OPEC executive, in a recent Al Jazeera interview, said about 20 million barrels of oil pass through the Strait daily. That’s roughly 25% of global daily consumption.
While analysts argue that a prolonged blockade of the Strait is unlikely due to the U.S. naval presence, the mere possibility still adds a significant margin to the existing risk in the energy market.
Oil market watchers are also bracing for further escalation.
Still, some are skeptical the rally will last.
Analyst Daan Struyven at Goldman Sachs raised his short-term price target, warning that the conflict could briefly cut 1.75 million barrels per day of Iranian oil, pushing Brent above $90.
However, he expects prices to fall back to the $60s by 2026 as supply recovers.
Spare capacity from OPEC+ members like Saudi Arabia and the UAE, along with potential increases in U.S. shale output, could ease the impact of any short-term supply shock.
For now, oil markets remain volatile, with uncertainty over potential further attacks keeping traders on edge through the weekend.