Middle East Conflict Pushes Oil Prices Above $100 a Barrel
Oil prices have surpassed $100 a barrel for the first time since May as tensions in the Middle East escalate. The price of Brent crude, the international benchmark, has been steadily rising since last week and is expected to remain above this milestone.
The recent surge in oil costs can be attributed to several factors, including attacks on Saudi energy infrastructure by Iran-supporting Houthi rebels and the apparent response from Iran striking a US base in Jordan. This development has raised concerns about a potential supply squeeze due to the loss of Iranian tanker capacity.
As hostilities across the Middle East prevent usual oil and natural gas supplies, Brent crude prices have increased by almost 50% over the past 12 months. Wholesale gas prices for the UK are also significantly higher, at 125% above September 2025 levels.
Saxo UK's investor strategist, Neil Wilson, believes that markets are pricing in a longer war and more disruption to global energy markets, leading to a structurally higher inflation dynamic alongside fiscal pressures.