**Oil Prices Surge Amid Regional Conflict: Israel Strikes Iran**

**Global oil prices witness a sharp rise of over 10% following Israel's military action against Iran, stirring concerns of a broader conflict and potential supply disruptions.**

Global oil prices experienced a dramatic increase after Israel announced it had conducted strikes on Iranian targets, marking a significant escalation in Middle Eastern tensions. In the wake of the announcement, the price of benchmark Brent crude surged over 10%, hitting levels not seen since January. The escalation has raised alarms among traders regarding potential disruptions in oil supplies originating from the energy-abundant region.

Initial gains in oil prices moderated slightly, yet Brent crude remained over 5% higher than its closing price on Thursday, currently trading at around $74.47 per barrel. Despite Friday's fluctuations, prices are still more than 10% lower compared to the previous year and well below the peaks experienced in early 2022, when prices soared past $100 due to geopolitical disturbances following Russia's invasion of Ukraine.

In response to the crisis, share markets across Asia and Europe exhibited declines, with Japan's Nikkei index down by 0.9% and the UK's FTSE 100 witnessing a decrease of 0.3% during lunchtime trading. US stock markets also mirrored this downturn, with the Dow Jones Industrial Average falling by 1.5% and the S&P 500 down by 0.8%. Concurrently, "safe haven" assets like gold and the Swiss franc saw gains, as investors sought refuge in more stable investments during turbulent times, with the gold price hitting a nearly two-month high of $3,423.30 an ounce.

Following the Israeli strikes, the Israeli Defense Forces indicated Iran's response included launching around 100 drones toward Israeli territories. Analysts suggest that energy traders are poised to closely monitor the situation’s evolution in the coming days. Vandana Hari from Vanda Insights noted, "This is an explosive situation that could either de-escalate swiftly, as witnessed last year, or lead to a larger conflict impacting oil supplies."

Experts from Capital Economics warned that if Iranian oil production facilities were targeted, Brent crude prices could potentially rise to between $80 and $100 a barrel. Nonetheless, such a price spike might motivate other oil producers to boost output, which could subsequently stabilize prices in the longer term.

Rod Dennis from the UK motoring organization RAC commented on the uncertainty surrounding future petrol prices, emphasizing the significance of wholesale fuel price trends and retailer margins. He acknowledged the complexity of predicting immediate impacts following the latest price hikes.

In a worst-case scenario, Iran could retaliate by disrupting daily oil supplies significantly if they target critical infrastructure or shipping routes in the vitally important Strait of Hormuz, where about one-fifth of the world's oil passes through. The strait, bordered by Iran, Oman, and the UAE, serves as a crucial link between the Gulf and the Arabian Sea, facilitating the transportation of energy resources.

Analysts are prepared for continued market evaluations as the implications of this escalating conflict unfold in the upcoming days. As Saul Kavonic, head of energy research at MST Financial, stated, "The market's initial risk-on reaction will need to adapt to the potential escalations that might arise from this situation."