- Brent climbed as much as 3.7% to $116.75, staying on track for a record monthly gain after a 60% surge in March, while WTI briefly moved above $100.
- The escalation followed Houthi missile launches toward Israel and Iran’s restrictions on traffic through the Strait of Hormuz.
- The U.S. reportedly deployed additional troops to the region, while talks around securing enriched uranium from Iran raised concerns about potential deeper military involvement.
Major oil stocks and index funds traded higher early Monday as crude surged after Iran-backed Houthi militants entered the Middle East conflict and additional U.S. troops moved into the region, raising fears the widening war could further disrupt global energy supplies.
Battalion Oil (BATL) surged over 7%, EON Resources (EONR) gained about 2%, Trio Petroleum (TPET) rose roughly 1%, the United States Oil Fund (USO) added about 1%, while Indonesia Energy (INDO) edged marginally lower.
Brent Tops $116 As Middle East War Escalates
Global benchmark Brent crude climbed as much as 3.7% to $116.75 a barrel and remained on track for a record monthly gain after rising about 60% in March. West Texas Intermediate briefly traded above $100 before trimming gains.
The move followed missile launches by Yemen’s Iran-backed Houthi militants toward Israel over the weekend. The group said it would “continue operations” until attacks on Iran and its proxy forces cease, opening a new front in a conflict now in its fifth week.
Iran has also restricted most traffic through the Strait of Hormuz, which previously carried roughly 15 million barrels per day of crude and about 5 million barrels per day of refined products. U.S. President Donald Trump said Tehran allowed additional tankers to pass as a goodwill gesture. Trump also told the Financial Times that he wants to “take the oil in Iran” and could target the Kharg Island export hub.
Ground Operation Risks Grow In Iran War
The U.S. has reportedly ordered thousands of additional troops into the region, raising concerns about a possible ground operation. Washington is also apparently weighing a plan to extract nearly 1,000 pounds of enriched uranium from Iran, a move that could place U.S. forces inside the country for days and potentially extend the conflict timeline.
Meanwhile, the Houthis’ entry into the conflict introduces fresh risks to Red Sea shipping and to cargo flows routed through Saudi Arabia’s Yanbu export system, an increasingly important bypass following disruptions to the Strait of Hormuz. Israel’s Channel 12 separately reported Israeli troops would not participate if the United States launches a land operation inside Iran.
Bonds Gain Appeal As Oil Surge Continues
Ole Hansen of Saxo Bank said on X that markets are starting to shift from reacting mainly to an inflation shock toward pricing a broader slowdown risk, with the change “beginning to lend support to both bonds and gold.”
First Abu Dhabi Bank said the duration of the conflict will be critical for the macro outlook, warning that “the longer and more protracted the conflict is, the more structurally damaging and hawkish it will surely be for the macroeconomic outlook.” However, the bank still sees scope for a “short-term stagflation environment” if fighting eases in the coming weeks, according to a report by Dow Jones Newswires.
Meanwhile, LBBW said disruptions across energy markets could trim growth on both sides of the Atlantic by roughly 0.25 percentage points this year. Morgan Stanley said recent moves in inflation swaps already “reflect increasing downside risks to growth,” adding that those risks would likely rise further if energy prices continue climbing.
Pimco said high-quality bonds are again becoming attractive portfolio stabilizers, noting that “this is a practical moment to consider rebalancing” for portfolios heavily tilted toward equities.
How Do Stocktwits Users Feel About Energy Stocks?
On Stocktwits, retail sentiment was mostly ‘bearish’ among energy stocks, with USO and EONR seeing ‘low’ message volume and INDO and TPET registering ‘extremely low’ activity. BATL stood out with ‘bullish’ sentiment and ‘normal’ message volume.
Over the past year, BATL has surged about 382%, followed by EONR up roughly 127%, USO up around 61%, and INDO up about 46%, while TPET has declined by nearly 33%.
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