Global oil prices maintained their strong upward momentum, closing near their highest levels in six months, amid heightened market anxiety. This rise is primarily driven by escalating concerns about potential supply disruptions due to rising tensions between the United States and Iran, bringing the geopolitical risk premium back to the forefront of crude oil pricing.
Market performance and benchmark figures
In trading details, Brent crude futures reached $70.69 per barrel. Despite a slight decrease of 0.03% at the daily settlement, the broader picture points to a sharp upward trend, with crude achieving weekly gains of 7.3%, while monthly gains jumped to a remarkable 16.2%.
On the other hand, U.S. West Texas Intermediate crude closed at $65.21 a barrel, down 21 cents or 0.32% in the last session, but still posted a weekly gain of 6.8% and a strong monthly increase of 13.6%.
Geopolitical risks and their impact on the market
John Kilduff, a partner at an energy consulting firm, commented on the current situation, saying: “The current situation is mainly about the Iranian issue; the market has already priced in significant geopolitical risks related to Tehran, but it is still difficult to determine the actual magnitude of the impact and the timeframe of these tensions at this stage.”.
Oil prices touched their highest levels since early August 2025 during last Thursday's session, reflecting the market's extreme sensitivity to any political news that could threaten the region's stability.
General context and importance of stable energy supplies
These developments are significant due to the strategic location of the Arabian Gulf region on the global energy map. Historically, tensions between Washington and Tehran have been a major factor influencing oil price volatility, given the importance of the Strait of Hormuz, through which a large percentage of the world's seaborne oil supply passes. Any threat to this waterway or to oil facilities in the region prompts investors and speculators to drive up prices in anticipation of supply shortages.
Expected economic impacts
From an economic standpoint, keeping oil prices above $70 a barrel has varying repercussions both domestically and globally:
- At the level of producing countries: This increase contributes to strengthening public budgets and reducing the financial deficit, which supports economic development plans in the Gulf countries and the Arab region.
- At the global economic level: Continued high energy prices may increase inflationary pressures in consuming countries, raising production and transportation costs, and may prompt central banks to reconsider interest rate policies to control inflation.
The situation remains dependent on the extent of political developments and the ability of OPEC and its allies to balance the market in the event of any emergency that threatens supply chains.
