Oil Prices Surge Past $100 as Middle East Tensions Escalate

Oil prices surged past $100 a barrel on Wednesday, driven by escalating tensions in the Middle East. Brent crude futures rose as much as 2.3% to a session high of $100.19, breaking the symbolic price level for the first time since July 24.

The conflict between Iran and the US has fueled concerns about energy-driven inflation, prompting stock markets across the globe to come under pressure. The pan-European STOXX 600 index fell 0.7%, with economically sensitive industrial and banking stocks among the top decliners.

Analysts believe that higher oil prices will prompt central banks to keep monetary policy tighter for longer. 'We think crude needs to hit $150 to create a major drawback in demand cycle,' said Societe Generale multi-asset strategist Manish Kabra. However, he cautioned that if price margins for refined products did not decline, diesel prices would increase and have a trickle-down impact on inflation and services.