Oil prices hit $100 a barrel for the first time since May

KUALA LUMPUR, 24 JULY 2026 —

Brent crude, the global benchmark, surged past $100 a barrel for the first time since May after Houthi militia in Yemen attacked oil tankers in the Red Sea.

The benchmark jumped more than 6% on Thursday alone, extending three straight days of gains as the US stepped up military strikes against Iran. Prices had retreated to pre-February levels during a temporary ceasefire between Washington and Tehran, but that truce has collapsed.

The spike followed warnings from US Secretary of State Marco Rubio that Iran’s leadership “are not ready to make a deal.” The renewed conflict has erased the temporary ceasefire that had pushed crude prices back to levels last seen before the US and Israel began military action against Iran on 28 February.

Gas markets have also tightened over the past month. The UK benchmark gas price has climbed to about 150p per therm from 98p at the end of June, according to industry data. UK petrol prices have risen by 5p a litre since early July to nearly £1.56, while diesel averages £1.72 a litre, RAC figures show.

In the US, average gasoline prices have returned above $4 a gallon, up from $3.92 a month ago, AAA data indicate.

Analysts warn the supply disruption risks reigniting inflation in the UK and US. Jonathan Raymond, investment manager at Quilter Cheviot, said higher energy costs would “ripple through the wider economy,” lifting production and transport expenses before feeding into food and other goods prices. “This creates another headache for central banks,” he said, adding that persistently elevated energy prices could force policymakers to keep interest rates higher for longer.

The Bank of England has held its key rate at 3.75% in four consecutive meetings. Paul Dales, chief UK economist at Capital Economics, said he expects the bank “almost certainly” to hold again, though analysts still forecast cuts next year if energy prices ease.

In the US, newly appointed Fed chair Kevin Warsh told Congress last week that the central bank has “no tolerance for persistently elevated inflation.” He reaffirmed commitment to restoring price stability despite political pressure from President Donald Trump for faster rate reductions.

Markets are now pricing in the possibility that the Middle East conflict will prolong supply tightness. With the Red Sea route disrupted and US strikes continuing, the risk of further attacks on shipping lanes and energy infrastructure has pushed traders to rebuild risk premiums into oil and gas prices.