Oil Prices Swing Wildly as Iran War Sparks Global Supply Fears

Global oil markets have entered a period of extreme volatility as geopolitical tensions escalate in the Middle East. The conflict involving Iran, which intensified after military strikes by the United States and Israel in late February 2026, has triggered major concerns about global energy supplies. Brent crude quickly surged from around $70 per barrel to above $100, at times approaching $120, sending shockwaves through financial markets.

The primary driver behind the dramatic price swings is the risk to oil flows from the Persian Gulf. Iran has targeted shipping routes and energy infrastructure in the region, raising fears that exports moving through the Strait of Hormuz could be disrupted. This narrow waterway is one of the world’s most critical energy chokepoints, carrying a significant share of global crude shipments. Even small shifts in the perceived risk to that route can trigger large moves in oil prices.

To calm markets, the International Energy Agency (IEA) and several major economies announced a coordinated release of roughly 400 million barrels from emergency oil reserves. The United States has also signaled plans to tap its Strategic Petroleum Reserve to offset supply pressures and limit the impact on fuel prices.

Despite these measures, analysts say oil markets will likely remain highly sensitive to geopolitical developments. If shipping through the Strait of Hormuz is seriously disrupted, prices could rise further. Conversely, any signs of de‑escalation or stabilization in supply flows could quickly push prices lower, keeping volatility elevated in global energy markets.