Crude oil prices surge up to 3% as US-Iran tensions spike after UAE nuclear plant attack
Synopsis
A drone strike on the UAE's Barakah nuclear power plant has sent crude oil prices surging up to 3% in a single session — on top of a 7% rally the previous week. With Trump warning Iran that 'the clock is ticking' and one-fifth of global oil shipments at risk through the Strait of Hormuz, this is no ordinary price spike: it is a geopolitical stress test for global energy supply.
Key Takeaways
Brent crude rose 2.37% to $111.86 per barrel on 18 May ; WTI climbed 3.11% to $108.70 per barrel .
MCX crude oil futures traded at ₹9,978 , up 3.02% or roughly ₹300 .
A drone strike on the UAE's Barakah nuclear power plant triggered fresh supply-disruption fears.
Crude had already gained more than 7% the previous week amid Strait of Hormuz tensions.
US President Donald Trump warned Iran on Truth Social that 'the clock is ticking' after aligning with Xi Jinping on blocking Tehran's nuclear ambitions.
Nearly one-fifth of global oil and LNG shipments transit the Strait of Hormuz , amplifying supply-risk concerns.
Global crude oil prices extended sharp gains on Monday, 18 May as escalating US-Iran tensions stoked fears of major supply disruptions, following a drone strike on the Barakah nuclear power plant in the United Arab Emirates. The attack intensified an already volatile geopolitical standoff that has rattled energy markets for weeks.
How Far Prices Have Climbed
International benchmark Brent crude surged as much as 2.37 per cent, or $2.60, to $111.86 per barrel. US West Texas Intermediate (WTI) crude climbed even sharper, advancing 3.11 per cent, or $3.28, to $108.70 per barrel. On domestic exchanges, crude oil futures for June 18 on the Multi Commodity Exchange (MCX) traded at ₹9,978, up 3.02 per cent or approximately ₹300.
This follows a rally of more than 7 per cent in the preceding week alone, as hopes for a diplomatic settlement dimmed and military incidents multiplied around the Strait of Hormuz.
The Strike on Barakah and Regional Escalation
According to reports, UAE authorities confirmed they were investigating the origin of the strike on the Barakah nuclear power plant and asserted their right to respond to what they described as ‘terrorist attacks’. A fresh wave of drone strikes also targeted Saudi Arabia, compounding fears of a broader regional conflict. Escalating rhetoric from both Washington and Tehran has further unsettled markets.
Trump's Warning and the Xi Factor
US President Donald Trump signalled a markedly tougher stance on Iran, stating he had reached an understanding with Chinese President Xi Jinping that Tehran must not be permitted to develop nuclear weapons and must reopen the Strait of Hormuz. In a post on his Truth Social platform, Trump warned Iran that ‘the clock is ticking’ — a pointed signal of growing pressure amid stalled diplomatic efforts.
Why the Strait of Hormuz Is Central
Nearly one-fifth of global oil and liquefied natural gas shipments pass through the Strait of Hormuz, making it a critical export artery for major producers including Saudi Arabia, Iraq, and Qatar. Any sustained disruption to the strait would send shockwaves through global energy supply chains, analysts note. This is not the first time the strait has been at the centre of a geopolitical standoff, but the current combination of nuclear brinkmanship and drone warfare marks a significant escalation in intensity.
Wider Market Impact
Asian equity markets traded mostly lower in response to the risk-off mood. Japan's Nikkei fell around 1 per cent and Hong Kong's Hang Seng declined over 1 per cent, while South Korea's KOSPI bucked the trend with a gain of nearly 1 per cent. Rising crude prices add inflationary pressure on oil-importing economies, with India — among the world's largest crude importers — particularly exposed to sustained price spikes.
With diplomatic channels between the US and Iran showing no immediate sign of reopening, energy markets are bracing for continued volatility in the sessions ahead.
Point of View
But the real story is the cumulative 10%-plus move in barely two weeks — a pace that, if sustained, will translate directly into fuel price pressure in India within weeks. What makes this episode structurally different from earlier Hormuz scares is the convergence of drone warfare, nuclear brinkmanship, and a US president publicly coordinating pressure with Beijing. That trilateral dynamic — Washington, Beijing, and Tehran — has no clean historical parallel, and markets appear to be pricing in a non-trivial probability of physical supply disruption rather than just diplomatic noise. For New Delhi, which imports roughly 85% of its crude, the MCX move to ₹9,978 is a leading indicator of downstream pain that policymakers may struggle to absorb without either subsidising consumers or passing costs on.
NationPress
9 Aug 2026
Frequently Asked Questions
Why are crude oil prices rising sharply today?
Crude oil prices surged up to 3% on 18 May after a drone strike hit the UAE's Barakah nuclear power plant, compounding existing fears of supply disruption through the Strait of Hormuz amid escalating US-Iran tensions. The move follows a 7%-plus rally the previous week.
How much have Brent crude and WTI risen?
Brent crude rose 2.37%, or $2.60, to $111.86 per barrel, while WTI advanced 3.11%, or $3.28, to $108.70 per barrel on Monday. On India's MCX, crude oil futures traded at ₹9,978, up about ₹300 or 3.02%.
What is the Strait of Hormuz and why does it matter for oil?
The Strait of Hormuz is a narrow waterway between Iran and Oman through which nearly one-fifth of global oil and liquefied natural gas shipments pass. It is the primary export route for major producers including Saudi Arabia, Iraq, and Qatar, making any closure or disruption a critical threat to global energy supply.
What did Trump say about Iran amid the oil price spike?
US President Donald Trump posted on his Truth Social platform warning Iran that 'the clock is ticking', signalling growing pressure on Tehran amid stalled diplomatic efforts. He also said he had agreed with Chinese President Xi Jinping that Iran must not be allowed to develop nuclear weapons and should reopen the Strait of Hormuz.
How does the crude price rise affect India?
India is one of the world's largest crude oil importers, making it highly sensitive to sustained price increases. The MCX crude futures move to ₹9,978 on 18 May signals potential downstream pressure on fuel prices, which could feed into broader inflation if the geopolitical standoff prolongs.
