Crude oil prices extended their sharp rally on Tuesday, driven by escalating supply concerns linked to the ongoing Middle East conflict. European benchmark Brent crude moved past the $85 per barrel mark for the first time since July 2024 during intraday trade.
As of 6:23 am ET, Brent crude for May delivery jumped 7.19% to $84.85 per barrel, after briefly trading above $85 earlier in the session. Meanwhile, West Texas Intermediate (WTI) for April delivery gained 7.69%, trading at $77.33 per barrel.
The surge reflects heightened fears of potential supply disruptions in the region, particularly involving key transit routes such as the Strait of Hormuz, which handles a significant portion of global crude flows. Markets are increasingly factoring in geopolitical risk premiums amid uncertainty over shipping routes, infrastructure safety and possible retaliatory measures.
The rally follows several days of volatility in global energy markets, with traders closely monitoring military developments and diplomatic signals. Oil’s sharp upward move has also triggered gains in energy-linked assets, while broader markets remain cautious amid inflation and supply chain concerns.
With tensions ongoing, crude prices are expected to remain highly sensitive to headlines and developments in the region.