Oil prices surged about 20% on Monday as the expanding U.S.-Israeli war with Iran prompted major Middle Eastern producers to cut supplies, reaching highs not seen since July 2022. Iraq and Kuwait have reduced output, amid fears of prolonged disruptions in the Strait of Hormuz. The conflict could impose weeks or months of elevated fuel costs worldwide, even if it resolves quickly.
According to a Reuters report from Tokyo on March 9, 2026, oil prices surged as the expanding U.S.-Israeli war with Iran disrupted Middle Eastern supplies. Brent crude futures climbed as much as $18.35, or 19.8%, to $111.04 per barrel, and stood at $107.93 after a $15.24, or 16.4%, gain as of 0014 GMT. U.S. West Texas Intermediate (WTI) crude futures rose $16.50, or 18.2%, to $107.40 per barrel, having earlier hit $111.24 after a $20.34, or 22.4%, increase. Brent had gained 27% and WTI 35.6% the previous week.
Iraq's main southern oilfields production has dropped 70% to 1.3 million barrels per day, unable to export via the Strait of Hormuz, with storage at maximum capacity, according to an official with the state-run Basra Oil Company. Kuwait Petroleum Corporation started cutting output on Saturday and declared force majeure on shipments. Qatar had previously reduced liquefied natural gas supplies. Analysts expect the United Arab Emirates and Saudi Arabia to follow soon due to depleting storage.
"I think prices have rallied this morning on the reports that Middle East producers are now reducing output due to storage facilities filling up fast," said Daniel Hynes, senior commodity strategist at ANZ. He added, "The next flag will be whether it eventually gets to a point where they have to start shutting in oil wells, which not only impacts output even further, it delays a response once the conflict eases as well. That would potentially sustain those prices for much longer."
Iran named Mojtaba Khamenei to succeed his father Ali Khamenei as Supreme Leader on Monday, indicating hardliners remain in control in Tehran amid the week-old conflict. Satoru Yoshida, a commodity analyst with Rakuten Securities, stated, "With the appointment of the late leader’s son as Iran’s new leader, U.S. President Donald Trump’s goal of regime change in Iran has become more difficult." He predicted WTI could reach $120 and then $130 per barrel soon, as Iran continues closing the Strait of Hormuz and attacking other producers' facilities. Israel's military has threatened to kill any Khamenei replacement, while Trump said the war might end only after Iran's military and rulers are eliminated.
Meanwhile, U.S. Senate Democratic Leader Chuck Schumer urged Trump to release oil from the Strategic Petroleum Reserve. "President Trump should release oil from the SPR now to stabilize markets, bring prices down, and stop the price shock that American families are already feeling thanks to his reckless war," Schumer said in a statement.
Iran's attacks persist: The Fujairah Media Office reported a fire in the UAE's Fujairah oil zone from falling debris, with no injuries. Saudi Arabia's Defence Ministry said on X it intercepted a drone targeting the Shaybah oilfield. The war has damaged facilities, disrupted logistics, and heightened shipping risks.
