Oil futures rose Monday after Israel and Iran exchanged direct strikes over the weekend, before both sides said they would hold off further attacks, according to analysts and market reports. The renewed hostilities — the first direct strikes between the two countries since an April ceasefire — sent crude prices higher on concerns of a wider regional escalation that could further disrupt global oil flows.
West Texas Intermediate crude for July delivery settled up 0.8% at $91.30 a barrel on the New York Mercantile Exchange, rising for the first time in three sessions. Brent crude, the global benchmark, rose 1.2% to $94.25 a barrel on ICE Futures Europe. In early Asian trade Tuesday, WTI edged 0.1% higher to $91.40 a barrel, ANZ Research analysts said.
The weekend strikes raised concerns of a broader conflict, although “cooler heads appear to be prevailing to start the week,” Arlan Suderman of StoneX said in a note. Houthi threats against Israeli shipping in the Red Sea add risk, he said. “With global commodity trade already facing notable logistical snares due to the ongoing closure of the Strait of Hormuz, a resumption in Houthi attacks in the Red Sea would add yet another layer of complexity.”
The Strait of Hormuz, a narrow waterway between Iran and Oman through which about a fifth of the world’s oil passes, remained largely closed Monday. President Trump posted on social media that peace negotiations are proceeding and said the blockade will remain in effect until a “Final Deal” is reached, according to market reports. Trump also urged Israel and Iran to stop their strikes.
Iran said it had ended its retaliatory attacks on Israel, according to reports. Yemen’s Iran-backed Houthis announced there would be a complete ban on Israeli shipping in the Red Sea, ANZ Research analysts said in a research report. This “raises risk around one of the key alternative routes for Saudi Arabian crude oil to make its way onto the international market,” though there is some conjecture over what constitutes an Israeli vessel, the analysts added.
The risk premium in oil markets remains high as the high-demand summer season approaches, analysts said. “We have demand picking up in the northern hemisphere globally and so far we’re not really seeing much dent in demand,” Tracy Shuchart of NinjaTrader Group said. Houthi threats against Israeli shipping in the Red Sea would exacerbate the problem as flows are being diverted through that route from the Strait of Hormuz, Shuchart added.
Oil prices pulled back from earlier highs during Monday’s session after Trump’s post and Iran’s statement that it had ended its attacks, with WTI up 1.4% at $91.78 a barrel and Brent 1.8% higher at $94.73 around midday, before settling lower.
In other energy-sector news, BP shares rose 1.2% to 552.30 pence in London trading. Barclays analyst Lydia Rainforth said the company’s shares have significant upside potential if management can execute its simplification strategy. New CEO Meg O’Neill has made an impressive start to her tenure by opting to reset the company into upstream and downstream divisions, Rainforth said. O’Neill also needs to define the future of the low carbon business, which has been a source of suboptimal investments and still needs careful management, Rainforth added. The sudden departure of Chairman Albert Manifold shouldn’t distract from the success management has had so far, she said.
In India, Jefferies analysts said utilities stand to benefit from improving power demand. On-year power demand growth of 7% in April-May looks strong versus Jefferies’s 6% growth estimate for fiscal year 2027, the analysts said in a research report. Potential below-average monsoon if the El Nino phenomenon occurs could add to upside for Indian power demand growth, they said. Jefferies’s top picks are JSW Energy, Adani Energy Solutions and NTPC, which are all rated buy. The bank raised its target price on JSW Energy to 745.00 rupees from 675.00 rupees and on Adani Energy Solutions to 1,905.00 rupees from 1,665.00 rupees, while maintaining the target price on NTPC at 470.00 rupees. Shares of JSW Energy, Adani Energy Solutions and NTPC were last quoted at 573.20 rupees, 1,585.95 rupees and 356.65 rupees, respectively.
In North America, Badger Infrastructure Solutions shares rose 6.5% to C$94.41 after the company reported results that Frederic Bastien of Raymond James said show a company steadily rebuilding credibility after a softer fourth quarter. Bastien raised his target price on the stock to C$98 from C$77. “We see this improving performance as proof that Badger’s manufacturing and commercial strategies are delivering intended results,” Bastien said, pointing to new truck builds ramping up on the back of higher demand in the first quarter. Efficiencies at the Red Deer Plant, driven by a sharpened focus on “building hydrovacs right the first time,” are helping offset tariff and inflation pressures, while new branch openings in core U.S. markets are strengthening service for major customers, Bastien said.