New York: Oil prices surged past $100 a barrel on Sunday for the first time in nearly four years, as escalating conflict in the Middle East fuelled concerns over prolonged disruptions to global energy supplies.

Both major crude benchmarks — West Texas Intermediate (WTI) and Brent — jumped by more than 15 per cent when markets opened on Sunday evening. Prices reached levels last seen during the early months of Russia’s 2022 invasion of Ukraine.

US President Donald Trump downplayed the surge, describing it as a temporary impact linked to efforts to eliminate Iran’s nuclear threat.

“Short term oil prices, which will drop rapidly when the destruction of the Iran nuclear threat is over, is a very small price to pay for U.S.A., and World, Safety and Peace,” he wrote on social media Sunday evening.

“ONLY FOOLS WOULD THINK DIFFERENTLY!” he argued.

Strait of Hormuz disruption fuels market anxiety

The sharp price jump comes amid severe disruptions to maritime traffic in the Strait of Hormuz, a critical energy chokepoint through which around 20 per cent of global crude and gas supplies pass.

Shipping through the strait has almost completely halted since the war began on February 28.

At the same time, oil and gas producers across the Gulf have begun reducing output. Israeli strikes on fuel depots in Tehran have further heightened fears that Iran could retaliate by targeting energy infrastructure in neighbouring countries.

The rising crude prices have already begun pushing up petrol costs in the United States, a politically sensitive issue ahead of midterm elections scheduled for November.

US says supply disruptions will be short-lived

US Energy Secretary Chris Wright insisted earlier Sunday that supply disruptions would not last long.

“Worst case, that's a few weeks. That's not months,” he told CNN.

“They shouldn't go much higher than they are here because the world is very well supplied with oil,” he added in remarks to CBS. “There's no energy shortage in all of the Western hemisphere.”

Wright said the United States is in talks with shipping companies that are seeking ways to move their vessels safely out of the Gulf.

“Early tankers probably will involve some direct protection by the US military” to pass through the Strait of Hormuz, he said, adding that traffic could return to normal “relatively soon.”

Sanctions, production and global supply pressures

Iran produces roughly four per cent of the world’s oil, according to the US Energy Information Administration.

Although Iran’s oil sector is under international sanctions, industry data indicates that some exports continue, mainly to China.

Meanwhile, US Treasury Secretary Scott Bessent said on Friday that Washington is considering lifting sanctions on additional Russian oil. The statement came a day after the United States temporarily authorised India to purchase oil from Moscow as global prices climbed.

Also on Friday, the US International Development Finance Corporation announced a reinsurance mechanism worth up to $20 billion to cover risks linked to travel through the Strait of Hormuz.