On March 19, intensifying geopolitical conflicts in the Middle East drove a strong rally in international oil prices. Brent crude surged nearly 7%, breaking above $107 per barrel, while WTI crude approached the $100 mark.

On March 18 local time, key natural gas facilities in Iran were attacked. The Iranian Revolutionary Guard promptly warned of retaliatory strikes on energy infrastructure across the Gulf region, sparking fears of disruptions to crude oil supplies. Markets are concerned about shipping safety in the Strait of Hormuz, through which roughly 20% of global crude oil trade passes; any blockage would directly hit supply.

Meanwhile, the U.S. is considering deploying additional troops to the Middle East, keeping regional tensions elevated. Although the U.S. has relaxed sanctions on Venezuela and Iraq has resumed some oil exports, near-term supply fears have completely overshadowed these offsetting factors.

Analysts note that persistently high oil prices will fuel global inflationary pressures, further limiting room for central banks to cut rates. If the conflict continues to spread, oil prices may climb further, creating dual pressure on the global economy and financial markets.