Oil prices surge 20% as expanding US-Israeli war with Iran cuts supplies from Mideast

An oil tanker sits anchored in Muscat, as Iran vows to close the Strait of Hormuz, amid the US-Israeli conflict with Iran, in Muscat, Oman, March 7, 2026. -- Photo: REUTERS/Benoit Tessier

TOKYO: Oil prices surged about 20% on Monday, hitting their highest since July 2022, as the expanding U.S.-Israeli war with Iran led some major Middle Eastern oil producers to cut supplies and on fears of prolonged disruption to shipping through the Strait of Hormuz chokepoint.

Iraq and Kuwait have begun cutting oil output, adding to earlier liquefied natural gas reductions from Qatar, as the war blocked shipments from the Middle East.