Global oil prices soar after Israel attacks Iran
What happened
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Israeli airstrikes hit numerous Iranian targets—including military facilities, nuclear sites (Natanz, Fordow), missile factories, and key IRGC commanders—kicking off a major operation that Israel vows to continue until the threat is neutralized axios.com+15newsmax.com+15reuters.com+15thetimes.co.uk+1barrons.com+1.
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Iran retaliated by launching over 100 drones toward Israeli airspace; Israel intercepted most of them en.wikipedia.org+2thetimes.co.uk+2abcnews.go.com+2.
Oil prices spike
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After the initial strikes, oil jumped sharply:
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WTI surged ~7–8% to about $73/barrel, briefly touching ~$77.50 nypost.com+3reuters.com+3apnews.com+3axios.com+8newsmax.com+8investopedia.com+8.
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Brent rose ~7%, reaching the mid-$70s, with intra-day highs near $78–78.50 theguardian.com+13reuters.com+13newsmax.com+13.
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This marks the biggest single-day jump since 2022, comparable to the surge from Russia’s invasion of Ukraine politico.com+3m.economictimes.com+3reuters.com+3.
Why oil is soaring
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Geopolitical risk: Any military escalation in the Middle East increases concern about supply disruptions .
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Strait of Hormuz fears: Roughly 18–20 million barrels per day pass through this chokepoint—any closure could dramatically impact supply apnews.com+4reuters.com+4m.economictimes.com+4.
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Flight to safety: Investors have shifted into gold, Swiss franc, and treasury bonds—classic haven assets npr.org+9reuters.com+9m.economictimes.com+9.
Market ripple effects
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Global stock markets fell sharply—Dow plunged ~700 points (~1.6%) and U.S. indices pulled back across the board nypost.com.
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Gold prices climbed ~1–1.5%, nearing multi-month highs en.wikipedia.org.
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Analyses warn of stagflation risk—higher oil could push inflation up (~5% if oil hits ~$120/barrel), squeezing growth and complicating central bank policies .
Outlook & key scenarios
| Scenario | Potential Impact |
|---|---|
| Localized strikes continue | Oil remains elevated but may stabilize if core supply unaffected newsmax.com+1npr.org+1apnews.com |
| Wider escalation (e.g. Hormuz, oil infrastructure attacks) | Prices could surge past $100–and up to $120–130/barrel |
| Markets calm | OPEC or U.S. strategic reserves might be deployed to stabilize prices |
Bottom line
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Oil surged ~7–14% intraday, settling with a ~6–7% weekly gain after Israel’s deep strike into Iran.
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Heightened supply risk through the Strait of Hormuz and potential Iranian retaliation are fueling volatility.
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Markets are nervous: equities are down, gold’s up, and oil could break $100 if the situation worsens further.
Let me know if you’d like a deeper dive into regional economic effects, potential responses
from OPEC or the Fed, or how this might influence India’s fuel costs.