Oil prices surged in late Sunday trading after the United States launched strikes on three Iranian nuclear Saturday evening in a major escalation of the Iran-Israel conflict.
US oil futures jumped 3.6% to about $76.47 per barrel. Brent futures increased 3.2%, settling at $74.59 per barrel.
US stock futures fell in response to the attacks. Dow futures dropped 0.6%. S&P 500 futures fell 0.6%, while Nasdaq futures tumbled 0.7%.
The US dollar rose 0.3%.
Israeli stocks were bolstered Sunday by the news and surged to record highs. The Tel Aviv 125 climbed 1.8% to close at 2,919.62. The TA-35 gained 1.5% to close at 2,877.78, an all-time high.
The United States produces an average of roughly 13.4 million barrels a day. Crude oil stockpiles have increased more than 200 million barrels since early January and OPEC+ recently announced plans to increase production, but there are growing concerns that Iran may close the Strait of Hormuz or pressure the flow of oil and trade in the area.
Economists are especially concerned about retaliations that could disrupt the flow of oil, which is heavily dependent on the strait. Any sharp jump in oil prices could potentially trigger higher inflation for the US economy.
During 2024 and the first quarter of 2025, more than 25% of seaborne oil trade flowed through the strait, according to the US Energy Information Administration. The US imported about 500,000 barrels per day through the strait, accounting for 7% of total US crude oil and condensate imports.
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