Oil markets have experienced extreme volatility since the outbreak of conflict in the Middle East, with prices surging dramatically due to escalating fears of supply disruptions, particularly through the Strait of Hormuz.
Market Volatility Overview
Since the commencement of the US-Israeli actions against Iran, oil prices have fluctuated wildly, moving from panic highs to periods of relief. Brent crude saw a significant surge, jumping over 55% from approximately $72 per barrel on February 27th to near $120 at its peak. This period included one of the largest one-month oil price surges recorded.
- Market Reaction: Headlines related to the conflict caused both the largest daily gains and significant daily drops for Brent crude in recent history.
Key Price-Influencing Events Timeline
The following timeline details critical moments that directly impacted global oil pricing following the escalation of tensions:
February 28: Initial Strikes
- The conflict began with joint US-Israeli strikes against Iran on a Saturday, a day when oil markets were closed.
- These strikes reportedly targeted key Iranian officials and led to immediate Iranian retaliation against infrastructure across Gulf capitals, injecting chaos into regional energy supplies.
March 2: Energy Export Halt
- On the first trading day following the strikes, oil and gas prices jumped as the conflict halted energy exports from the Middle East.
- Tehran began attacking energy facilities and ships, leading to the closure of navigation in the Gulf and a slowdown in energy production from Qatar to Iraq.
March 8: Escalation and Output Cuts
- As the conflict entered its second week, Iranian oil facilities were struck for the first time.
- On March 9th, Brent surged near $120 a barrel. This period saw output cuts from the UAE, Iraq, and Kuwait due to depleted storage.
March 18: Gas Field Attacks
- Following an Israeli attack on Iran's South Pars gas field, Tehran retaliated by striking Ras Laffan, a major energy facility in Qatar. This marked a sharp escalation and caused energy prices to surge.
March 23: Brief De-escalation Hopes
- Brent dipped below $100 per barrel following reports that the US and Iran were discussing an end to hostilities, suggesting potential ceasefire talks.
April 13: Port Blockade
- Crude oil prices jumped after the US Navy imposed a blockade on Iranian ports, following a failure to reach a peace agreement during negotiations in Pakistan.
April 17–21: Strait of Hormuz Control
- Iran's Foreign Minister declared the Strait of Hormuz fully open to commercial traffic on April 17th, causing prices to fall by over 10%.
- Prices rose again on April 20th after the US Navy engaged an Iranian container ship in the Gulf of Oman.
- Subsequently, Iran re-imposed tighter control over the strait within hours of reopening it, with reports of gunfire on tankers and vessels.
Future Outlook
Trump subsequently labeled Iran's actions over the weekend a "total violation" of the truce, renewing threats to strike Iranian power plants and bridges if Tehran did not comply with a deal.
