Oil Prices Surge as US-Iran Conflict Escalates

Oil prices surged over 1% on Monday after a US attack on an Iranian island in the Strait of Hormuz led to retaliation from Tehran, extending conflict in the Middle East into its sixth month.

The US struck two launchers on Iran's Larak island on Sunday, marking the first known American strikes on the Gulf nation since late July. In response, Iran attacked two US air bases in Jordan, according to Iranian media citing the Revolutionary Guards.

IG market analyst Tony Sycamore noted that 'Looks like we are in another escalation phase... Could be days, could be weeks' for how long this lasts. Technical charts showed that if the conflict escalated and pushed WTI above resistance at $85.80 to $85.90 a barrel, it would open the way for further gains.

Brent crude futures climbed 1.23% to $89.18 a barrel as US West Texas Intermediate crude rose 1.10% to $84.32 a barrel. The Strait of Hormuz, through which a fifth of the world's oil flows, remains closed due to ongoing conflict.