Oil prices surge above $105 per barrel as conflict in Iran moves into its third week

Oil Prices Surge Amid Escalating Conflict in Iran

Storage tanks at the Valero Houston Refinery in Houston, photographed on March 13, 2026. (Credit: Mark Felix/Bloomberg/Getty Images)

Oil prices soared to their highest point since July 2022 on Sunday night, following statements from the Trump administration indicating that the ongoing conflict with Iran could persist for several more weeks. President Donald Trump also urged the global community to assist in reopening the Strait of Hormuz to oil shipping.

Market Reaction

• Brent crude, the international oil standard, climbed 2.9% to approximately $106.12 per barrel.
• US crude oil prices increased by 2.6%, reaching $101.53 per barrel.

Major Disruption in Oil Supply

The US and Israel-led military campaign in Iran has entered its third week, resulting in what experts are calling the largest disruption to oil supplies in history. Since hostilities began, Iran has effectively blocked the Strait of Hormuz—a critical passageway for global oil shipments—preventing tankers from passing through. This strait is responsible for transporting about one-fifth of the world’s oil supply.

Efforts to Secure Oil Shipments

The Trump administration has made repeated attempts to calm fears about the impact on shipping. President Trump announced plans to deploy US naval forces to safeguard oil tankers leaving the Middle East, but officials admit it could be weeks before these operations are fully underway.

On Saturday, Trump used Truth Social to call on other nations to work together to reopen the strait and restore oil flows, aiming for a swift and orderly process.

Volatility in Oil Markets

Oil prices often experience greater swings during after-hours trading, as lower trading volumes lead to increased speculation. Last Sunday, prices nearly touched $120 per barrel before settling closer to $100 by Monday.

Regional Tensions Escalate

Iran has intensified its response by laying mines in the Strait of Hormuz and threatening to target any oil and gas infrastructure linked to the US. Since the conflict began on February 28, several tankers have been attacked in the region.

The US has also launched strikes on Kharg Island, the center of Iran’s oil production, though the Trump administration has stated that Iran’s oil facilities have not been targeted for now.

Measures to Address Oil Shortages

• Over the weekend, the US government approved a new BP project in the Gulf of Mexico—the company’s first major initiative since the Deepwater Horizon incident.
• Energy Secretary Chris Wright instructed Sable Offshore Corp. to restart offshore rigs and pipelines near Southern California.
• On Wednesday, member nations of the International Energy Agency agreed to release 400 million barrels of emergency oil reserves, marking the agency’s largest coordinated release. However, these supplies from the Americas and Europe are not expected to reach the market until the end of March.

Impact on Gas Prices and Global Trade

According to AAA, US gasoline prices have surged by 24% since the conflict began, now averaging $3.70 per gallon. This spike threatens to undermine one of Trump’s key achievements—lower gas prices during his second term, especially after prices dipped below $3 per gallon in December, the lowest since May 2021.

The closure of the strait affects more than just oil. Farmers worldwide depend on fertilizer shipments passing through the Strait of Hormuz, which could lead to higher food prices. Perishable goods such as dairy, fruits, vegetables, and seafood are also at risk of becoming more expensive due to shipping disruptions.