Oil prices surged past $100 per barrel in early Thursday trading, reaching an eight-week high after an Iran war escalation threatened severe disruptions to global energy supplies, according to market data and reports tracked by NBC News. Brent crude rose more than 6% to top $100 per barrel, marking its highest level since the end of May, while U.S. crude jumped over 5% to nearly $92 per barrel. The latest price spikes follow claims by Tehran-backed Houthi rebels that they attacked two Saudi oil tankers in the Red Sea.
Red Sea Attacks Open New Front in Middle East Conflict
The reported tanker strikes mark the first time since the onset of the conflict that ship attacks have expanded beyond the vicinity of the Strait of Hormuz, according to regional reporting. The Houthi threat has intensified market anxiety because millions of barrels of oil transit the Bab el-Mandeb strait daily. According to maritime trade figures, roughly 12% to 15% of global maritime trade—valued at over $1 trillion—passes through the waterway each year. This route has served as a vital alternative to the Strait of Hormuz, where traffic has largely stalled with ship crossings falling to single digits, according to trade data from earlier in the week.
Did you know? Between 12% and 15% of total global maritime trade passes through the Bab el-Mandeb strait annually, making it a critical choke point for international shipping and energy markets.
Crude Surge Drives Up Pump Prices and Consumer Borrowing Costs
The jump in crude has translated directly to higher costs for consumers. The national average gas price rose to $4.09 per gallon, up from $4.06 the previous day, according to motor club AAA data tracked by NBC News. This upward movement has erased much of the progress made after the United States and Iran signed a memorandum of understanding in mid-June. That diplomatic arrangement has since collapsed, with President Donald Trump warning Wednesday that the U.S. would target an Iranian bridge or power plant for every vessel attacked by Tehran.
Financial markets have reacted swiftly to the renewed inflationary pressures. “Inflation has remained top of the agenda for markets this morning,” said Deutsche Bank’s global head of macro research, Jim Reid, pointing to the jump in Brent oil and noting that the strikes between the U.S. and Iran show no sign of easing. Driven by these inflation fears, the U.S. 10-year Treasury bond traded at 4.67% early Thursday, its highest level since January 2025. Because that benchmark heavily influences consumer loans, the average 30-year U.S. mortgage rate climbed to 6.77% on Wednesday, reaching its highest mark since July 2025.
Frequently Asked Questions
Why are oil prices rising so sharply?
Oil prices have climbed due to escalating conflict involving Iran and Houthi rebel claims of attacks on Saudi oil tankers in the Red Sea, threatening key maritime transit routes and global energy supplies.
How much have oil prices increased recently?
Brent crude rose above $100 per barrel, its highest level since late May. Overall, oil prices have risen about 35% since the start of the month and more than 60% since the beginning of the year, according to market reports.
What impact is this having on consumers at the pump and in housing markets?
The national average gas price increased to $4.09 per gallon, while rising bond yields pushed the average 30-year U.S. mortgage rate to 6.77%, according to data tracked by NBC News.
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