US Strikes on Iran Could Possibly Trigger Oil Prices Shock of $10 to $20 per Barrel

A sudden escalation between Washington and Tehran has placed global energy markets on edge, with analysts warning that oil prices could surge by as much as $10 to $20 (£7.40 to £14.80) per barrel if tensions spiral further. The warning follows sweeping US strikes on Iran early Saturday, carried out alongside Israel, in what President Donald Trump described as a decisive effort to dismantle Iran's nuclear programme and weaken its ruling regime.

Within hours, Iran retaliated, raising fears of a broader regional conflict that could disrupt critical oil supply routes. Energy analysts say the absence of swift de-escalation could send oil prices sharply higher when markets reopen on Monday, with the scale and speed of the confrontation leaving traders bracing for significant volatility.

Markets React to Sudden Escalation

Even before the latest strikes, oil prices had been edging higher amid rising geopolitical risk. On Friday, Brent crude futures climbed roughly 2.9 per cent to close above $72.80 (£53.90) per barrel, while West Texas Intermediate rose about 2.8 per cent to trade above $67 (£49.60).

Jorge León, head of geopolitical analysis at Rystad Energy, said that without signs of de-escalation over the weekend, prices could jump by $10 to $20 (£7.40 to £14.80) per barrel. 'Given the scale of retaliation, most of the strategic initiative now lies with Iran,' he said. 'How Tehran chooses to respond over the next 24-72 hours — especially toward energy infrastructure or regional shipping — will be the primary driver of near-term oil market dynamics.'

Retaliation Raises Stakes for Oil Prices

Iran responded to the strikes by launching missiles at US military assets and energy infrastructure across the Gulf, including locations in Bahrain, the UAE and Qatar. Saudi Arabia also reported attempted strikes on Riyadh and its oil-rich eastern provinces.

Such actions heighten concerns that oil prices may not merely reflect a temporary risk premium but a genuine threat to supply. Iran produces approximately 3.3 million barrels per day, accounting for around 4% of global output. Any disruption to its exports — or to neighbouring producers — could tighten markets rapidly. León cautioned that a wider conflict involving oil infrastructure throughout the Gulf 'would push prices even higher.'

Strait of Hormuz in Focus

At the centre of market anxiety lies the Strait of Hormuz, the narrow waterway through which roughly a fifth of the world's oil supply passes each day. Iran holds significant leverage over the strait and, following the strikes, vessels reportedly received radio warnings from the Islamic Revolutionary Guard Corps stating that 'no ship is allowed to pass the Strait of Hormuz.'

Analysts note that a full closure would be difficult to sustain, but even partial disruption could send prices soaring. Iran has previously attacked tankers and laid mines in the region, and several oil majors and trading houses reportedly suspended shipments through the strait immediately after the attacks.

Diplomatic Breakdown and Military Build-up

The confrontation followed the collapse of talks between US and Iranian negotiators in Geneva on Thursday, which Oman's foreign minister had described as making 'progress' toward a deal. Trump described the subsequent military operation as 'massive and ongoing', stating the objective was not only to neutralise Iran's nuclear capabilities but also to dismantle its naval forces and weaken regional proxy groups.

In recent weeks, the US deployed significant military assets to the Gulf, marking the largest concentration of American air power in the Middle East in over two decades. This build-up had already contributed to rising oil prices as traders priced in geopolitical risk.

OPEC+ and the Limits of Mitigation

Attention now turns to OPEC+, which is scheduled to meet on Sunday amid speculation it may increase output quotas beyond the previously expected 137,000 barrels per day. Such a move could help temper immediate price spikes, though analysts warn any production boost would only 'mute some upside pressure on prices Monday morning, but only marginally in the face of heightened geopolitical risk.'

In past episodes, including air strikes last summer on Iranian nuclear facilities, oil prices initially rallied but later stabilised as retaliation proved limited. This time, early indications suggest Iran's response is broader and more aggressive.

What Happens Next

The trajectory of oil prices now hinges on Tehran's next move. Should Iran escalate further — particularly by targeting energy infrastructure or interfering with the Strait of Hormuz — markets could see the upper end of the projected $20 per barrel shock.

Conversely, swift diplomatic intervention or restrained retaliation could limit the damage. For now, the message from energy analysts is clear. In a region that supplies a critical share of the world's crude, even the threat of disruption can move markets dramatically. With US strikes and Iranian retaliation unfolding in real time, oil prices remain at the mercy of geopolitics.