Oil Prices Surge as Tensions Mount in the Middle East

The global market remains on edge due to rising oil prices and escalating tensions in the Middle East. Brent crude futures surged 1.3% to $97.5 a barrel, marking its highest level in seven weeks.

The conflict has driven up fuel prices worldwide, with diesel hitting record highs last week and increasing by around 90% compared to pre-war levels.

Central banks are now likely to raise interest rates in response to the energy shock, making this week's U.S. consumer price data a key focus for investors. The European Central Bank is expected to lift its benchmark rate to 2.5% on Thursday, with futures implying another hike to 2.75% by December.

The Federal Reserve has also seen an increase in expectations of a rate hike, with markets pricing a 58% chance of a move when it meets on September 16 and 70% for a move in October.