The primary US benchmark for oil experienced a surge exceeding 30 percent on Monday, driven by apprehensions that the ongoing conflict in the Middle East may lead to extended supply disruptions. At 0230, West Texas Intermediate was up 30.04 percent at $118.21 per barrel, before easing slightly, while Brent Crude was 27.54 percent higher at $118.22. On Monday, Iran appointed Mojtaba Khamenei to take over from his father, Ali Khamenei, as Supreme Leader, indicating that hardliners continue to maintain a strong grip on power in Tehran, just a week into its conflict with the United States and Israel.

Brent experienced an increase of 27%, while WTI saw a rise of 35.6% in the preceding week, prior to the most recent surges. Israel’s military reported that it targeted Iranian commanders in the Lebanese capital early on Sunday, broadening the reach of its campaign into the core of Beirut following several days of strikes that have resulted in nearly 400 fatalities. Israel’s military has issued a warning regarding the potential consequences for any successor to Khamenei, while U.S. President Donald Trump indicated that the conflict may persist until Iran’s military and leadership are completely eliminated.

The ongoing conflict may result in consumers and businesses globally enduring prolonged periods of elevated fuel prices, even in the event of a swift resolution, due to suppliers contending with compromised facilities, interrupted logistics, and heightened shipping risks.

Saudi Arabia, the leading oil exporter, is augmenting its shipments from the Red Sea; however, the quantities remain insufficient to compensate for the decline resulting from the turmoil in the Strait of Hormuz, as indicated by shipping data.