Middle East Tensions Send Oil Prices Soaring to Six-Week High

Oil prices surged to a six-week high on Monday as tensions in the Middle East escalated. Brent crude settled at $97.31 per barrel, its highest point since July 24. This increase is attributed to Iran's vow to strike energy infrastructure across the region in response to further US attacks on its assets.

Iranian Parliament Speaker Mohammad Baqer Qalibaf warned that 'Strike our assets and you get struck,' marking a sharp escalation of the conflict that has reduced oil supply from the region since February 28. The US-Iran conflict has resulted in significant disruptions to shipping lanes, with an average of just 10 commodity ships transiting through the Strait of Hormuz per day over the past 10 days, the lowest since May.

Analysts expect further price increases as global energy markets remain fragile due to continued conflict and exchange of fire. Goldman Sachs forecasts that oil could rally as high as $120 per barrel if attacks on shipping intensify, while Priyanka Sachdeva from Phillip Nova warned that 'if tanker traffic begins to slow materially, the market could price in a much larger supply shock.'