Brent crude settled at $94.25 per barrel, up $1.16 (1.3%), while West Texas Intermediate (WTI) closed at $91.30 per barrel, gaining $0.76 (0.8%). Both benchmarks had surged more than 5% earlier in the session as renewed military activity over the weekend heightened fears of prolonged disruptions to Middle East energy supplies.
The conflict escalated after Israel struck a petrochemical facility in southwestern Iran that it alleged was tied to ballistic missile production. Iran responded with an attack targeting a similar facility in Haifa, Israel. The exchange followed additional Israeli operations against Hezbollah positions in Lebanon, a key sticking point in ongoing efforts to negotiate a broader regional ceasefire.
Although Iran and Israel later indicated they would suspend attacks, Tehran warned that military operations could resume if Israel continues its campaign against Hezbollah. President Trump publicly urged both sides to immediately cease hostilities.
Market participants remain focused on the status of the Strait of Hormuz, through which roughly 20% of global oil and liquefied natural gas supplies typically transit. Concerns that shipping restrictions could remain in place for an extended period helped support crude prices despite signs of de-escalation.
Iranian officials indicated the strait could reopen under a new framework jointly administered by Iran and Oman, potentially including transit fees. Meanwhile, Iran-backed Houthi forces in Yemen announced plans to restrict Israel-linked shipping through the Red Sea, adding to concerns over regional maritime trade.
Analysts noted that a limited agreement reducing immediate military risks while leaving broader geopolitical disputes unresolved remains the most favorable near-term outcome for energy markets.
On the supply side, OPEC+ agreed over the weekend to implement another increase in production targets. However, many analysts believe the decision will have little practical effect, as several member countries remain unable to significantly boost output due to infrastructure constraints, regional disruptions, and ongoing geopolitical challenges.