Global oil prices surged by about 25% on Monday, reaching their highest level since mid-2022, as the escalating conflict involving Iran, the United States and Israel rattled financial markets and raised concerns over global energy supplies.
Brent Crude was on track for a record one-day gain, while gold prices dropped more than 2%. Analysts said the surge in oil prices strengthened the US dollar and reduced expectations of near-term interest-rate cuts.
Agricultural markets also climbed, particularly edible oils, as vegetable oils are widely used in the production of biofuels. Aluminium prices firmed on supply concerns, although other metals faced pressure from the stronger dollar.
Tony Sycamore, a market analyst at IG Group, said the sharp reaction reflected fears that the escalating conflict in the Middle East may continue without a clear resolution.
“The violent reaction stems from the markets seeing no obvious offramp in the escalating Middle East conflict,” he noted, warning that the risk of broader economic damage continues to grow.
Meanwhile, Iran announced that Mojtaba Khamenei will succeed his father Ali Khamenei as the country’s Supreme Leader, signalling that hardliners remain firmly in control in Tehran amid the ongoing conflict.
