Brent crude crosses $105 as Middle East tensions keep oil markets volatile

Global oil markets remained highly volatile after Brent crude prices climbed above $105 per barrel following renewed geopolitical tensions linked to the ongoing Iran conflict.

The latest price rally came after Israeli officials stated that the conflict with Iran was “not over,” triggering fresh concerns over potential disruptions to crude supply flows from the Middle East. The Strait of Hormuz, which handles nearly one-fifth of global oil trade, continues to remain at the center of global energy market attention amid military escalation and shipping risks in Gulf waters.

Market analysts say fears of further attacks on regional energy infrastructure, tanker movements and export terminals are continuing to support bullish sentiment in crude markets despite signs of weaker demand from some Asian buyers.

According to Citi analysts, oil prices may continue rising if diplomatic negotiations between the United States and Iran fail to produce a breakthrough. The report indicated that many short-term supply mitigation strategies are already being exhausted, leaving markets increasingly sensitive to any additional supply shock from the Gulf region.

At the same time, China has reportedly reduced crude oil imports by nearly 25% compared to pre-conflict levels. The decline in Chinese buying has temporarily improved crude availability in international markets and helped prevent a sharper spike in prices.

However, traders remain uncertain about how long China will maintain reduced import levels, particularly if industrial demand and refinery activity recover in the coming months.

Shipping markets are also closely monitoring the situation as higher oil prices continue impacting:

• Bunker fuel costs

• Tanker freight rates

• War risk insurance premiums

• Vessel operating expenses

Industry experts warn that prolonged instability in the Middle East could further tighten global energy markets and increase logistics costs across international trade routes, particularly for Europe and Asia which remain heavily dependent on Gulf crude supplies.