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The prices of oil and natural gas experienced significant increases this Monday amid fears of a prolonged escalation of the conflict in the Middle East, following Israeli and American attacks on Iran and Tehran's retaliations.
Tensions have led to the closure of energy facilities in the region and the partial interruption of maritime transport in the Strait of Hormuz, a strategic route through which approximately 20% of the world's oil and gas flows.
Strong market reaction
According to BBC, Brent crude, a global benchmark, rose by as much as 10% to exceed 82 dollars per barrel after at least three ships were attacked near the strait over the weekend. It later moderated its gains and fell to 79 dollars per barrel.
American crude oil rose by nearly 7.6%, reaching $72.20.
Natural gas prices also surged, with increases of up to 25%, reflecting concerns about potential sustained disruptions in supply.
The United Kingdom Maritime Trade Operations Center (UKMTO) reported that two vessels were hit and that an "unknown projectile" exploded near a third ship.
Global economic impact
A prolonged rise in oil prices could jeopardize the global economic recovery, fuel inflation, and drive up retail gasoline prices in the United States—a politically sensitive scenario for President Donald Trump and the Republican Party just months ahead of the November midterm elections.
In Europe, stock markets reacted with declines. London's FTSE 100 index opened with a drop of nearly 1%, particularly affected by airlines due to the closure of airspace in parts of the Middle East.
In France, the CAC-40 fell by 1.6%, while in Germany, the Dax dropped by 1.7%.
Analysts warn that if the conflict drags on and maritime transit restrictions in Hormuz intensify, the prices of crude oil and fuels could continue to rise in the coming weeks.
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