Oil prices surge as conflict in Iran disrupts Middle East supplies

Oil prices have surged past $100 a barrel, reaching their highest levels since 2022, as a war involving Iran, the US, and Israel disrupts supplies from the Middle East. The conflict has blocked tankers in the Strait of Hormuz, a critical shipping lane, cutting Iraq's oil output by about 60% and raising fears of fuel scarcity in Europe.

The US has launched a $20 billion reinsurance program for the Strait of Hormuz to try to stabilize oil trade. Market stress is high, with frenzied trading in options for commodities from oil to corn, and analysts warn the conflict threatens prolonged impact on energy markets and could imperil hundreds of billions in planned AI spending in the Gulf region.