How the Iran war shook oil prices, and what comes next
A view shows oil pump jacks outside Almetyevsk in Russia’s Republic of Tatarstan on June 4, 2023.
Alexander Manzyuk | Reuters
Oil markets have lurched from panic to relief and back to panic since the outbreak of war in the Middle East, and markets are bracing for more volatility.
Prices have risen more than 55 percent since the beginning of the war; Brent crude jumped from around $72 a barrel to around $120 at its peak on Feb. 27 as fears grew about supply disruptions in the Strait of Hormuz. Brent crude oil increased by 51% in March, achieving one of the record monthly oil price increases.
2026 Iran war and its impact on oil prices
War-related headlines led oil to post its biggest daily gain since the Russia-Ukraine war, while others caused Brent crude to post its biggest daily decline in decades.
Here are some of the key moments oil has reacted to since the start of the US-Israeli war against Iran, and where it might go next.
February 28
The war began with joint US-Israeli attacks on Iran on February 28, on a Saturday when there was no oil trade. Several prominent Iranian officials were killed in the attacks, including Ayatollah Ali Khamenei, the Islamic Republic’s long-time religious leader. Iran quickly responded, striking infrastructure in Gulf capitals, throwing the region and millions of barrels of oil into chaos.
March 2
Oil and gas prices rose on the first trading day since the strikes as war halted energy exports from the Middle East. Tehran began attacking ships and energy facilities, shutting down transportation in the Gulf and bringing energy production from Qatar to Iraq to a halt.
March 8
The war entered its second week with the increase in Iranian oil. Facilities were hit for the first time. When the markets opened on Monday, March 9, Brent rose close to $120 per barrel; US President Donald Trump said it was “a small price to pay” for defeating Iran. Energy exports in the Gulf remained under pressure as the United Arab Emirates, Iraq and Kuwait cut production and ran out of storage space.
FILE PHOTO: Iran’s new religious leader, Mojtaba Khamenei, the second son of the late Supreme Leader of Iran Ayatollah Ali Khamenei, attends a rally in Tehran, Iran, on May 31, 2019.
Hamid Forootan | via Reuters
Markets also reacted to the news that Iran appointed Mojtaba Khamenei, son of the late Ayatollah Khamenei, as its new Supreme Leader. He is seen as a more hard-line figure, as he has very close ties to Iran’s Revolutionary Guard Corps.
March 18
A picture of Qatar Energy’s operating facilities in Ras Laffan Industrial City, Qatar, on March 3, 2026.
Getty Images
March 23
A short-term risk aversion caused Brent to fall below $100 per barrel. Embers in question The US and Iran were discussing an end to the war, marking the first time the warring parties had come into contact.
The Iranians responded coolly, but these initial discussions reportedly paved the way for a ceasefire just weeks later.
March 28
Houthis in Yemen said they launched missiles at Israel, marking their first direct participation in the US-Israeli war against Iran.
7 April
An entire civilization will die tonight and will never be brought back. I don’t want this to happen, but it probably will.
President Donald Trump at Truth Social on April 7
13 April
Crude oil prices rose after the US Navy imposed a blockade on Iranian ports after the US and Iran failed to reach an agreement to end the war. Negotiations continue in Pakistan.
17-21 April
Iranian Foreign Minister Seyed Abbas Araghchi declared that the Strait of Hormuz is fully open to commercial traffic. Crude oil prices fell more than 10% on April 17.
Oil prices rose again on April 20 after the US Navy fired on and captured an Iranian container ship in the Gulf of Oman the previous day.
Over the weekend, Iran imposed tighter control over the strait, hours after it was reopened, with reports of tankers and ships being fired on.
Oil prices since the beginning of the year
Trump called Iran’s actions over the weekend a “total violation” of the ceasefire and renewed threats to strike Iran’s power plants and bridges if Tehran rejects a deal.
What’s next?
Vice President JD Vance and US negotiators, including Steve Witkoff and Jared Kushner, are heading to Islamabad on Tuesday for a second round of talks between the US and Iran. It is not yet clear who will lead the delegation from Iran.
The talks in Pakistan took place as the two-week ceasefire approached its end. Trump signaled there would be no extension.
The Strait of Hormuz remains functionally closed as the Iranian military says it will retaliate after the US Navy seized an Iranian-flagged cargo ship.
Commodity Context founder Rory Johnston said reopening the strait would likely trigger a sudden drop in crude oil prices to between $10 and $20 due to speculative positioning, but that relief would be temporary.
He added that supply chain bottlenecks, infrastructure damage and extended production outages will keep the market tight and Brent will likely stabilize in the $80 to $90 range rather than a full return to pre-crisis levels.
“This is still the largest oil supply shock in the history of the oil market,” Johnston said, adding that without a sustained improvement in flows, prices may need to rise further to curb demand.
