Oil prices surged above $115 per barrel in the United States early Monday, as escalating tensions linked to President Donald Trump’s latest deadline on Iran rattled global markets and pushed inflation expectations higher.
The sharp rise in crude has raised concerns that US inflation could climb to around 3.7 percent if prices remain elevated over the next several weeks, marking the highest level since September 2023. Analysts say energy costs are once again becoming a key driver of inflationary pressure.
Since the conflict involving Iran began on February 28, American consumers have already felt the impact. Estimates suggest that fuel spending has increased by roughly $240 million per day, bringing total additional costs to about $8.6 billion over the past five weeks.
Financial markets reacted quickly to the developments. US stock futures declined at the open, reflecting growing investor caution:
- S&P 500 futures fell by 0.7 percent
- Nasdaq 100 futures dropped by 0.8 percent
- Dow Jones futures slipped by 0.7 percent
At the same time, energy markets moved higher, with crude oil rising by around 3 percent and natural gas also gaining. Gold prices, however, dipped slightly.
The market volatility intensified after Trump announced a new deadline tied to potential action in Iran, with investors closely watching the next 45 hours for further developments.
Despite the heightened tensions, diplomatic efforts remain ongoing. US officials have reportedly maintained back-channel communication with Iranian Foreign Minister Abbas Araghchi, with mediation support from countries including Pakistan, Egypt, and Turkey. However, Iran has denied any meaningful progress in the talks so far.
Economists warn that sustained high oil prices could reverse recent gains in controlling inflation, not only in the United States but globally. Rising energy costs continue to influence household expenses, interest rate expectations, and overall economic stability, making the situation a key risk for markets in the coming weeks.
