Brent crude oil has climbed above $100 per barrel for the first time since July, driven by escalating military exchanges between the United States and Iran that have pushed the global oil benchmark higher. Futures in London rose as much as 2.3% in early trading before giving back some of those gains.

In the latest round of hostilities, the US Central Command reported that Iran attempted to strike a US naval destroyer with ballistic missiles overnight, prompting American forces to destroy five Iranian oil tankers in retaliation. The conflict has disrupted shipping through the Strait of Hormuz, a critical maritime choke point, though millions of barrels of crude continue to transit the waterway daily, with a significant portion carried by tankers that have switched off their tracking transponders.

Brent crude has surged more than 60% since the start of the year. However, aside from a brief spike in July, futures have remained below the $100 threshold for over three months as Gulf producers managed to ramp up export volumes. Meanwhile, refined products such as diesel have experienced far more pronounced price acceleration.

Beyond the ongoing Russia-Ukraine war, the Middle East conflict has now spread to the Red Sea region near Saudi Arabia. These compounding price increases could reignite inflationary pressures, adding fresh challenges for central bank policymakers worldwide.

Darrell Fletcher, managing director of commodities at Bannockburn Capital Markets, noted that with the conflict entering its seventh month, the path of least resistance continues to point steadily upward. Refined product fundamentals remain constructive as global inventories and reserves are being drawn down. Following established patterns, both Washington and Tehran persist in exchanging strikes and issuing warnings.