Oil prices surge again as Iran-US ceasefire near expiry

Oil prices recorded a sharp increase on Monday as markets reacted to escalating uncertainty in the Middle East, with investors closely monitoring tensions surrounding the fragile US-Iran ceasefire.

The rally comes as a two-week ceasefire agreement between the two countries is set to expire on Wednesday, raising fears of renewed conflict. Sentiment was further shaken after reports that the United States seized an Iranian-flagged cargo vessel in the Strait of Hormuz, casting doubt over the possibility of a new round of negotiations.

In trading, West Texas Intermediate (WTI) crude for May delivery jumped 6.87 per cent to settle at $89.61 per barrel on the New York Mercantile Exchange, while Brent crude for June delivery rose 5.64 per cent to close at $95.48 per barrel on the ICE Futures Exchange in London.

The Strait of Hormuz, a key global energy chokepoint responsible for roughly 20 per cent of the world’s oil shipments, has seen severely disrupted tanker movement since the conflict in the Middle East escalated at the end of February, further intensifying supply concerns.