Middle east tensions push oil prices higher, shake global markets

Mace | 19th June 2025 | International
ChatGPT Image Jun 19, 2025, 12_19_53 PM

Rising conflict between Israel and Iran is driving oil prices up and unsettling global markets. Brent crude and tanker insurance costs have surged, the FTSE 100 has dipped, and central banks remain cautious. Investors are watching closely amid fears of disruption in the vital Strait of Hormuz.

Escalating military activity in the Middle East, particularly between Israel and Iran, has driven crude oil prices higher over the past week. Following Israeli airstrikes on Iranian energy infrastructure, Brent crude surged around 7 per cent initially, briefly exceeding $75 per barrel, before settling near $74.5 per barrel during calmer trading sessions. The rise reflects concerns over supply disruption amid growing hostilities. Reports from international energy traders suggest that the threat of Iran blocking the Strait of Hormuz has prompted a surge in tanker insurance costs. Tanker charter rates have more than doubled, jumping from around $20,000 to $47,600 per day for very large crude carriers. Despite these premiums, shipments continue to transit via alternative routes, albeit at increased cost. Global market sentiment has softened in response to these developments. The FTSE 100 edged down by approximately 0.4 per cent in mid‑June trading, with around 70 per cent of its index comp...

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