Oil prices climbed above $100 a barrel for the first time since May on Thursday as escalating conflict in the Middle East renewed concerns over global energy supplies.
Brent crude, the global benchmark, rose more than 6% after several days of gains, with markets reacting to intensified US military strikes against Iran and attacks on oil tankers in the Red Sea.
The latest price surge follows a period of declining oil prices after a temporary ceasefire between the United States and Iran, which had eased concerns over supply disruptions before renewed hostilities reversed that trend.
Markets were rattled after Yemen's Houthi militia attacked two Saudi Arabian oil tankers, the Encelia and Layla, in the Red Sea using ballistic missiles, cruise missiles and drones.
The group said the attacks targeted crews accused of violating a naval blockade imposed in the Red Sea.
The incidents heightened fears over disruption to a key export route that Saudi Arabia has used to bypass the Strait of Hormuz while tensions between the United States and Iran continue to affect regional oil flows.
The renewed escalation has revived concerns that further disruption to major shipping routes could push oil prices even higher after they had retreated below $100 following hopes of a ceasefire.
Higher energy prices are raising concerns about inflation and the broader economic outlook.
Petrol and diesel prices have already increased, with average UK petrol prices reaching nearly £1.56 per litre and diesel averaging £1.72 per litre.
In the United States, average gasoline prices have climbed above $4 a gallon after standing at $3.92 a month earlier.
Gas prices have also risen over the past month, adding to concerns over household and business costs.
Financial markets weakened as investors weighed the potential impact of sustained conflict and higher energy prices, with government borrowing costs rising in several major economies and share prices falling on both sides of the Atlantic.
US Federal Reserve Chair Kevin Warsh said the central bank had "no tolerance to persistently elevated inflation" and remained committed to "restoring price stability" as the conflict continues to influence prices.