Global Oil Markets Surge Following US Nuclear Strike Crisis
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Yasmin Alta
- . June 23, 2025
- . Update: June 23, 2025 6:05 pm
The energy markets were very volatile when the United States attacked three sites of Iran’s nuclear facilities at Fordow, Natanz, and Isfahan over the weekend, and this is when the United States directly got involved in the war going on between Israel and Iran. The coverage of the incredible military action has shocked the global commodities markets, with oil prices moving about in the most dramatic ways in months.
Oil Prices Hit Five-Month Highs on Supply Fears
Immediately after the strikes, the price of Brent crude oil skyrocketed by 3.3 percent to rise to 79.60 dollars per barrel, whereas the price of U.S crude rose to 76.16 dollars per barrel, an equivalent of 3.1 percent. The radical fluctuations of the prices can be explained by the increasing fears of a possible shortage of the supply due to the most strategic oil-producing region in the world.
The market is keeping a keen attention on the response potential of Iran, especially to the Strait of Hormuz, which is a strategic waterway through which about 20% of crude oil in the world passes. Any disturbance in this important shipping route can cause a world energy crisis with far-reaching economic impacts.
The latest outburst of prices signifies the conclusion of weeks of building tensions, which started when Israel first launched a strike on the Iranian atomic facilities on June 13. Since the first appearance of that conflict, Brent crude experienced an increase of 11 percent, and the WTI experienced an increase of about 10 percent, showing that the market is sensitive to Middle East geopolitical events.
Financial agencies are continuously updating their oil price projections to high levels due to the rise in the level of tension. According to the JPMorgan analysts, there is a chance that Brent crude will trade up to $130 per barrel in the worst-case scenario, a number that is likely to be up by 64 percent at the current trading prices.
The doomsday scenario modelling of the bank takes into consideration the potential retaliation which may be unleashed by Iran, which may involve targeting oil infrastructure in the regions or hindering some of the important shipping routes. This would have the instantaneous effect of lowering the availability of oil supply in the world, and countries consuming oil would have to use strategic petroleum reserves.
Permanent disruptions have also raised the concern by Goldman Sachs that the prices could remain at a high level. Their reasoning indicates that partial disruption of supply for just several months may dramatically shift global energy market patterns in the course of 2025.
The fact that Iran is the third-largest producer of crude in OPEC complicates the situation pertaining to the present crisis. The revenues collected by the government of the country through the export of oil are vital to the functioning of the government and the economic stability of the country, which poses a strategic predicament to the Tehran leadership as to what retaliatory action can be taken.
According to industry sources, sustained disruption of supply is also an expensive gambit by the Islamic Republic, given that Iran also relies heavily on oil revenues. Nevertheless, the disruptions of supply may be expected in the short term since tensions are growing, and there are fewer and fewer possibilities to resolve the issues through diplomatic means.
The Iranian government has already suggested that the American attacks have widened the scope of legal targets of military actions, and there is a certain fear that regional infrastructure providing energy to the people of allied nations working closely with the United States has been in danger.
The bombing of the Iranian nuclear installations is likely to increase the oil price even further, and cause a stampede towards the safety investments due to further evaluation by the markets on the implications of the bomb disturbing the economy in general. The downward trend has already been experienced by stock futures as investors gear up for possible long-term volatility in various asset classes.
The Asian markets are especially susceptible to energy price surges due to their dependency on Middle Eastern oil barrel imports. Japan and South Korea have already raised concerns pertaining to the disruptions in trade, and other prime consuming countries are assessing the strategies on the use of strategic petroleum reserves.
The subject is under the close supervision of central banks across the globe, who fear that the continued increase in energy prices may complicate the monetary policy and, in some cases, may exacerbate the inflationary tendencies, which are still being contained by most economies.
