Oil markets saw a sharp rise on Thursday as tensions in the Middle East intensified. Prices jumped after Iran launched attacks on key energy facilities across the region, following an earlier strike on its own gas infrastructure. This sudden escalation has raised fears of supply disruptions, pushing global oil benchmarks higher.

The international benchmark, Brent crude oil, climbed significantly, gaining more than $4 per barrel and briefly rising above $112. At the same time,West Texas Intermediate (WTI) also increased, though at a slower pace. The difference in price between the two benchmarks has widened to its highest level in over a decade, largely due to increased U.S. oil supply and logistical challenges such as higher shipping costs.

The recent surge in prices is closely linked to attacks on energy infrastructure in the region. Missile strikes reportedly caused serious damage to facilities in Qatar, particularly around Ras Laffan, a major hub for liquefied natural gas exports. Meanwhile, Saudi Arabia, confirmed that it successfully intercepted several missiles and a drone aimed at its capital and energy sites. These developments have added to concerns that oil production and exports could face prolonged disruptions.

At the center of the conflict is the South Pars gas field, shared by Iran and Qatar, which is known as the largest natural gas field in the world. Any damage or instability in this area can have global consequences for energy supply. The situation has further escalated due to accusations and counterattacks involving Israel, and rising tensions with the United States.

Another key factor affecting oil prices is the uncertainty surrounding the Strait of Hormuz. This narrow waterway is one of the most important routes for global oil shipments. Any disruption or closure could significantly reduce supply, leading to even higher prices worldwide. Analysts believe that unless tensions ease soon, the risk to this route will continue to support elevated oil prices.

In addition to geopolitical issues, economic factors are also playing a role. The Federal reserve recently decided to keep interest rates unchanged but warned about rising inflation, partly due to the ongoing conflict. This combination of political instability and economic uncertainty is making the oil market more volatile.

Experts suggest that the situation may not improve in the short term. Continued attacks, military responses, and the possibility of further escalation could keep energy markets under pressure. As a result, oil prices are expected to remain high, affecting not only fuel costs but also global inflation and economic stability.

Overall, the current crisis highlights how sensitive global energy markets are to geopolitical tensions. Even a single event in a key region can quickly impact prices worldwide, showing the strong connection between politics and energy supply.

Credit: Independent News Pakistan (INP)