Monday, March, 9 2026 - Oil prices surged close to $120 per barrel on Monday, March 9, following Iran’s announcement of a new supreme leader, before later retreating to around $106.23 per barrel.
The appointment of Mojtaba Khamenei signaled the continued
dominance of hardline leadership in Tehran, raising fears of prolonged
disruption to shipping through the Strait of Hormuz and sending shockwaves
through global financial markets.
Brent crude, the global oil benchmark, climbed to an early
high of $119.50 per barrel before easing back to $106.23. Meanwhile, West Texas
Intermediate, the main U.S. crude benchmark, rose to $119.48 before dropping to
$101.25
Tensions in the region intensified as the conflict expanded
across key energy zones. Bahrain accused Iran of targeting a desalination
facility essential for drinking water supplies, while Israeli strikes
reportedly hit oil depots in Tehran overnight, leaving facilities smoldering.
The ongoing conflict, now entering its second week, has
increasingly involved areas critical to oil and gas production and transport in
the Persian Gulf. Concerns about the stability of supply routes have heightened
volatility across energy markets.
Prices cooled slightly after reports that members of the
Group of Seven were discussing the possible release of strategic oil reserves
to help stabilize global supply. The discussions, reported by sources familiar
with the talks, have not been officially confirmed.
Around 15 million barrels of crude oil roughly 20 percent of
global supply typically pass through the Strait of Hormuz each day. The narrow
waterway, bordered by Iran to the north, serves as a vital export route for oil
and gas from Saudi Arabia, Kuwait, Iraq, Qatar, Bahrain, the United Arab
Emirates and Iran.
However, the threat of missile and drone attacks has forced
many tankers to halt their movement through the corridor
Several Gulf producers, including Iraq, Kuwait and the
United Arab Emirates, have reportedly reduced production as storage facilities
fill up due to limited export capacity.
Meanwhile, attacks on oil and gas infrastructure by Iran,
Israel and the United States since the outbreak of the war have further
deepened concerns over supply disruptions.
U.S. President, Donald Trump said over the weekend that he
was not interested in negotiating with Iran, suggesting the conflict could end
only if Iran no longer maintains a functioning military or leadership
structure.
Hopes for de-escalation faded further when Iran formally
designated Mojtaba Khamenei as the country’s new supreme leader, succeeding his
father, Ali Khamenei.
The surge in oil and natural gas prices is already pushing
fuel costs higher worldwide, placing additional pressure on economies that rely
heavily on energy imports particularly across Asia.
The last time oil prices approached current levels was in
2022 following the outbreak of the Russian invasion of Ukraine.
Rising energy costs typically fuel inflation, squeezing
household budgets and weakening consumer spending, which is a key driver of
economic growth in many countries.
Global stock markets reacted sharply. Japan’s Nikkei 225
fell by 5.2 percent on Monday, while U.S. futures also slipped by more than 1.5
percent.
On Friday, the S&P 500 dropped 1.3 percent, and the Dow
Jones Industrial Average briefly plunged by as much as 945 points before
closing about 450 points lower. The Nasdaq Composite declined by 1.6 percent.
In the United States, the average price of regular gasoline
climbed to about $3.45 per gallon, roughly 47 cents higher than the previous
week, according to the AAA. Diesel prices rose even more sharply, reaching
around $4.60 per gallon.
U.S. Energy Secretary Chris Wright said during an interview
on State of the Union that fuel prices could fall below $3 per gallon again in
the near future.
Analysts warn that if oil prices remain above $100 per
barrel for an extended period, the global economy could face serious strain.
Iranian officials said Israeli strikes on oil depots and a
petroleum transfer facility in Tehran early Sunday killed four people. Israel’s
military said the sites were being used to supply fuel for missile launches.
Iran’s parliament speaker, Mohammad Bagher Qalibaf, warned
that the conflict could have far-reaching consequences for the global oil
industry.
Iran currently exports about 1.6 million barrels of oil
daily, with much of it shipped to China. Any disruption to those exports could
force China to seek alternative suppliers, potentially pushing global energy
prices even higher.
Natural gas prices have also risen during the conflict,
though less dramatically than oil. Prices recently climbed to around $3.33 per
1,000 cubic feet, up 4.6 percent from the previous trading session after
gaining roughly 11 percent last week.
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