The escalating conflict between Iran and Israel has raised global concerns over potential disruptions to oil supply, with missile exchanges continuing for a sixth consecutive day.
Oil prices surged by 4% on Tuesday in response to the instability but have since shown signs of easing in Asian markets. Analysts warn that continued tensions in the oil-rich Middle East could cause further price turbulence.
Efficient Group chief economist Dawie Roodt says that markets typically react with fear when key oil-producing regions are under threat, triggering sharp price increases.
“In the short term, we’re likely to see rising oil and petrol prices,” Roodt explained. “However, if the conflict begins to subside, I expect prices will stabilise and possibly decline. Much depends on whether the conflict escalates or draws in other nations.”
He added that while oil prices tend to spike quickly during conflict, they generally retreat over the medium to long term once tensions ease.
As the situation develops, global markets and consumers alike remain on high alert for further economic impacts.