Oil futures contracts exceed $115… and portend a fiery opening for the markets

While global stock exchanges were closed over the weekend, crude oil futures continued to rise in Sunday trading, driven by the escalation of the war in Iran and increasing fears of disruptions in global supplies, especially with the possibility of closing the Strait of Hormuz, one of the most important oil transport corridors in the world.

Data from the Hyperliquid Futures platform showed that West Texas Intermediate crude contracts jumped to about $115 per barrel on Sunday, compared to the close of Friday’s session at $91.27. Brent crude contracts, the global standard, also rose to about $117 per barrel, recording their highest levels since 2022, compared to $92.69 at Friday’s close.

Energy prices have witnessed a noticeable rise in recent weeks as markets reacted to the ongoing war in Iran.

The intensity of the conflict escalated over the weekend, even as US President Donald Trump called on Iran to surrender unconditionally, while Tehran confirmed that it would continue fighting as long as necessary.

Oil prices continued to rise after the UAE and Kuwait announced they would reduce their oil production due to the approaching closure of the Strait of Hormuz.

Kuwait has already begun reducing its production by about 100,000 barrels per day, with expectations that this reduction will increase if the war continues.

Other countries, such as Iraq, Saudi Arabia, and Qatar, also reduced their production during the current year, which prompted analysts to warn that the current crisis may deplete global oil and fuel stocks within weeks or even days.

Military escalation threatens energy

The crisis also escalated after Israel bombed key energy infrastructure in Iran over the weekend, while Iran targeted the Haifa refinery, one of Israel’s largest oil refineries.

Analysts believe that the most likely scenario is that oil prices will continue to rise as long as the war continues.

The military escalation had a negative impact on the American financial markets, as the Dow Jones Index fell by about 455 points on Friday, the S&P 500 Index fell by about 90 points, and the Nasdaq 100 fell by about 365 points.

Energy stocks post strong gains

On the other hand, shares of energy companies rose as investors expected strong revenues and profits in the near term.

Marathon Petroleum shares jumped about 10% last week, while shares of APA Corporation, Valero Energy, Philips 66 and EOG Resources rose more than 5%.

Diamondback Energy and ConocoPhillips also recorded notable gains during the same period.