New Delhi: Global crude oil prices surged by nearly 5 per cent on Monday, recording their biggest single-day gain since mid-May, as renewed military escalation between Iran and Israel heightened fears of prolonged instability in West Asia and potential disruptions to global energy supplies.

The sharp rally came after Iran reportedly launched ballistic missiles towards northern Israel, prompting retaliatory strikes by the Israeli Air Force on military targets in western and central Iran. The latest exchange has fuelled concerns that the conflict could intensify further, reducing hopes of an immediate de-escalation and increasing the risk of disruptions to critical oil supply routes.

The renewed tensions have sent energy markets into volatility, with investors closely monitoring developments across the region.

Brent and WTI crude prices surge

Following the escalation, Brent crude futures climbed towards the $98-per-barrel mark, while West Texas Intermediate (WTI) crude advanced towards $95 per barrel.

Earlier in the trading session, Brent crude futures gained more than $3 per barrel, rising around 3.4 per cent to approximately $96.24 per barrel. Meanwhile, WTI crude futures increased by nearly $2.9 per barrel, trading around $93.41 per barrel.

The gains effectively reversed most of the losses recorded during the previous week, when markets had briefly anticipated a reduction in regional tensions.

Analysts noted that traders are once again pricing in geopolitical risks as uncertainty surrounding the conflict continues to grow.

Escalating conflict drives market concerns

The latest rise in oil prices follows a series of military developments across the region.

Apart from the exchange between Iran and Israel, markets were also reacting to renewed Israeli military operations in Lebanon despite an existing truce. The developments have raised concerns that the broader regional conflict could persist for an extended period.

Energy traders remain particularly focused on the possibility of disruptions to oil shipments through the Strait of Hormuz, one of the world’s most strategically important maritime corridors for crude oil exports.

Any threat to shipping routes in the Gulf region has the potential to significantly affect global energy supplies and increase price volatility.

As a result, geopolitical developments have become the dominant factor influencing crude oil markets in recent weeks.

Crude prices rise more than 50% since conflict began

The ongoing conflict in West Asia has had a substantial impact on global energy markets.

Since the start of the war, crude oil prices have reportedly risen by more than 50 per cent as concerns over supply security and regional stability intensified.

The latest price increase reflects growing fears that diplomatic efforts may not be sufficient to prevent further escalation.

Market participants remain cautious as any expansion of hostilities involving major regional actors could trigger additional spikes in energy prices and broader economic uncertainty.

The conflict has also increased volatility across commodity markets, affecting sectors that rely heavily on energy inputs.

Trump reportedly urges restraint

Amid the rising tensions, reports suggest that US President Donald Trump urged Israeli Prime Minister Benjamin Netanyahu to avoid further military escalation.

According to reports, Trump indicated that additional attacks could complicate diplomatic efforts and potentially affect negotiations related to the conflict.

The remarks have drawn attention as Washington continues to balance support for regional allies with efforts to prevent a broader confrontation that could destabilise global markets.

However, despite diplomatic efforts, the latest military developments suggest that tensions remain high.

Impact on India and global aviation

The increase in crude oil prices is expected to have significant consequences for energy-importing nations, including India.

As one of the world’s largest importers of crude oil, India remains particularly vulnerable to sustained increases in global energy prices. Higher crude costs can affect fuel prices, transportation expenses, inflation and overall economic growth.

The aviation sector is also facing mounting pressure. According to comments from Willie Walsh, Director General of the International Air Transport Association (IATA), rising fuel costs are creating major challenges for airlines worldwide.

IATA estimates that average jet fuel prices could be approximately 70 per cent higher year-on-year, potentially adding around $100 billion to the global aviation industry’s collective fuel bill this year.

Higher fuel costs could ultimately translate into increased operational expenses and higher airfares for passengers.

Markets await next developments

Financial markets are expected to remain sensitive to developments in West Asia over the coming days.

Investors will closely monitor military activity, diplomatic initiatives and any indications regarding the security of oil transportation routes. The situation surrounding the Strait of Hormuz is likely to remain a key focus for energy traders and policymakers alike.

Any signs of de-escalation could help stabilise prices, while further military action may push crude oil prices even higher.

Conclusion

Global oil prices have recorded their strongest rise since mid-May as fresh military exchanges between Iran and Israel reignited fears of supply disruptions and prolonged conflict in West Asia. With Brent crude nearing $98 per barrel and WTI approaching $95, the impact is already being felt across global markets. For countries such as India and industries like aviation, sustained high oil prices could lead to increased costs, inflationary pressures and economic uncertainty in the months ahead.