US-Iran Tensions Spark Oil Price Surge, Diesel Fuel Reaches Record High

Oil prices have surged by more than 6% over the week as tensions between the US and Iran escalate, with diesel fuel prices in the US reaching a record high. Brent crude oil futures rose 6.1%, while West Texas Intermediate crude oil futures rose 8.3%. However, both contracts declined slightly during the day, with Brent falling by $0.75 or 0.79% to $94.77 per barrel and WTI falling by $0.95 or 1.04% to $90.35.

Analysts point to continuing disruptions in oil supplies as a major contributor to the price increase. Despite reports that Middle Eastern oil supplies had returned to nearly normal levels, tanker-tracking systems suggest that supplies remain severely disrupted. US strikes against Iran have intensified fears of further supply disruptions and escalating tensions between the two countries.

Rystad Energy's chief economist Claudio Galimberti noted that diesel affects every sector of the economy, contributing to high government bond yields in the US due to expectations of further inflation growth. Analysts are warning of a 'hard landing' for the global economy as oil prices continue to rise and fuel prices reach record highs.