The price of oil is expected to surge on Monday following US-Israeli strikes on Iran and the effective closure of the Strait of Hormuz, raising fears of higher fuel costs for motorists. US crude could rise by 11% when trading resumes, according to data from broker IG, potentially reaching over $74 a barrel, its highest level since June 2025.
Iran’s Revolutionary Guards reportedly prohibited passage through the Strait of Hormuz on Saturday, effectively shutting the key choke point through which about $500bn of energy trade and 20% of global oil supplies pass annually. A tanker in the strait was attacked on Sunday, and at least 150 other vessels dropped anchor as traffic slowed to a near standstill.
The AA warned that UK drivers could face higher prices at the pump, with the average price of petrol currently at 132.9p a litre and diesel at 142.4p. Spokesperson Luke Bosdet said: “Pump prices have been rising over the past week and the conflict escalation in the Middle East threatens even higher fuel costs for UK drivers.”
Opec+ agreed on Sunday to increase output by 206,000 barrels a day in April, more than expected, in an effort to calm markets. However, analysts noted the group has little spare capacity except for Saudi Arabia and the UAE, which will struggle to export oil until navigation in the Gulf returns to normal.
Global stock markets are expected to tumble, with London’s FTSE 100 forecast to fall by about 0.5% on Monday after hitting a record high on Friday. Investors are likely to seek safe-haven assets such as gold, which rose 2.25% to almost $5,400 an ounce over the weekend.
