Analysis: Oil prices jump following US strikes
By James Sillars, business and economics reporter
A 4% lift to oil prices.
It's the first financial market response to the US military action against Iran's nuclear facilities.
Brent crude is trading above $80 a barrel for the first time since January at the start of the trading week in Asia. It takes the rise in oil costs to 25% this month alone.
Prices have risen as Israel's campaign against Iran has gathered intensity.
Experts had widely warned last week that a level above $100 would easily be achieved in the event of disruption to oil supplies.
We are not there yet.
The big risk is that Iran moves to close the Strait of Hormuz - the Gulf shipping lanes that are a vital arterial route for both oil and gas supplies. The strait handles a fifth of global oil volumes and about a quarter of natural gas flows.
Any disruption to those exports would create a price shock similar to the one we saw back in 2022 when Russia invaded Ukraine.
Higher wholesale costs feed through not just to petrol pumps and energy bills. They make manufacturing and even many services become more expensive as extra costs feed down supply chains.
UK natural gas costs were more than 25% up in the month to date in advance of the US attacks. Those prices tend to track those for oil, so we can expect a similar move when London opens for business.
The FTSE 100 is currently forecast to open about 0.5% down, according to IG's futures model.
That does not sound like a lot when there has been a major escalation in the Middle East conflict, but the index will be propped up by energy stocks benefiting from higher prices.