Crude oil prices jumped more than 3% on Monday as tensions in the Middle East rose again following retaliatory attacks between Iran and Israel.
The situation has sparked concerns about the stability of the fragile ceasefire and the risk of a prolonged conflict that could affect global energy supplies.
Brent crude for July delivery rose 3.18% to $96.05 a barrel, while US West Texas Intermediate (WTI) crude for August delivery rose 3.46% to $93.67 a barrel.
The rise was driven by investor concerns about disruptions to oil supplies from the Middle East region, which is among the world’s top producers.
The Israel Defense Forces (IDF) confirmed that the Israeli Air Force had launched attacks on several military targets in western and central Iran.
At the same time, the White House said President Donald Trump had been briefed on the Iranian missile attack that hit Israel for the first time since the ceasefire was implemented.
The development is seen as potentially undermining ongoing diplomatic efforts between Washington and Tehran.
The situation became increasingly tense when an Iranian official involved in negotiations with the United States said that the agreement being worked on was now difficult to continue.
The speaker of the Iranian parliament, Mohammad Bagher Ghalibaf, also warned that any military action or sanctions by the United States could be considered a violation of the ceasefire, thus making US assets and bases in the region a legitimate target.
In a separate development, OPEC+ agreed to increase its oil production target by 188,000 barrels per day starting in July.
While increased supply usually puts pressure on oil prices, market sentiment is currently focused more on geopolitical risks that could potentially disrupt global energy supplies. That factor continued to be the main driver of oil prices' rise at the beginning of this week.
