Global oil prices jumped more than 2% in early trading on Monday after Israel ordered additional troop deployments to southern Lebanon, reigniting concerns over instability in the Middle East despite a ceasefire that has been in place for more than six weeks.
US benchmark West Texas Intermediate (WTI) crude rose 2.71% to $89.73 per barrel, while Brent crude futures gained 2.37% to reach $93.28 per barrel. The rally reflected growing fears that renewed conflict could threaten regional security and disrupt energy supplies.
Renewed Fighting Raises Market Concerns
The latest escalation comes amid heightened tensions between Israel and the Iran-backed Hezbollah group. Markets had been cautiously optimistic about a broader reduction in regional hostilities following recent diplomatic efforts, but Israel’s decision to reinforce military operations in Lebanon has cast doubt on the durability of the ceasefire.
The move follows US-hosted talks in Washington on Friday involving Israeli and Lebanese representatives. While those discussions were aimed at preserving stability along the border, the renewed military activity has increased uncertainty over prospects for lasting peace.
Israel-Hezbollah Conflict Remains Key Regional Flashpoint
The confrontation between Israel and Hezbollah has become one of the most significant extensions of the wider conflict involving Iran. Fighting erupted on March 2 when Hezbollah launched rockets and drones into Israel in support of Tehran.
Although a ceasefire agreement was reached in mid-April, sporadic clashes and cross-border exchanges have continued, keeping tensions elevated and markets on edge.
Ceasefire Extension Talks Continue
US President Donald Trump said on Friday that a decision regarding the extension of the ceasefire arrangement with Iran would be announced soon. The extension would provide negotiators with additional time to work toward a permanent agreement and address ongoing disputes surrounding Iran’s nuclear programme.
Any comprehensive settlement is expected to involve Israel, while Iran has repeatedly maintained that Hezbollah must also be included in any broader diplomatic framework.
Strait of Hormuz Risks Add to Supply Fears
In addition to the renewed conflict, concerns over global oil supplies have intensified following reports that mines have been placed in the Strait of Hormuz, one of the world’s most strategically important energy shipping routes.
Analysts warn that any further disruption in the strait could hinder efforts to restore normal shipping operations and delay the return of additional oil supplies to international markets.
The Strait of Hormuz handles roughly one-fifth of global oil and gas shipments, making it a critical artery for world energy trade. Iran has effectively restricted access to the waterway since hostilities escalated after US and Israeli strikes earlier this year, raising concerns about the security of global energy flows.
Geopolitical Risks Drive Oil Higher
With uncertainty surrounding the Israel-Hezbollah conflict, negotiations with Iran, and the security of the Strait of Hormuz, traders are once again factoring geopolitical risk into oil prices. Market participants will be closely watching developments in the region, as any further escalation could have significant implications for global energy markets and supply chains.
