International oil prices spike to $77.62 amid Middle East tensions…surging up to 14% at one point

On the 13th, WTI hits $77.62 during intraday trading

Concerns that decelerating inflation may reaccelerate

If Iran blocks the Strait of Hormuz

"Oil prices could rise to $130"

International oil prices are soaring amid news that Israel has conducted airstrikes on Iran. Inflationary pressure is intensifying as concerns grow over price increases resulting from the tariff policies of the Trump administration, coupled with mounting instability in global oil prices.

On the 13th, July futures for West Texas Intermediate (WTI) crude reached an intraday high of $77.62 per barrel, up about 14% from the previous session. August futures for Brent Crude also jumped more than 9% intraday to $78.5 per barrel compared to the prior session.

The Middle East is responsible for one-third of global oil production, and Iran, being the third-largest oil producer in OPEC, means the market has been directly impacted by this supply shock.

In the market, there is speculation that Iran could blockade the Strait of Hormuz—a key oil transit route—or possibly attack oil tankers passing through it. The Strait of Hormuz is the main export channel for Middle Eastern oil and gas, with one-third of the world's LNG and one-sixth of the world's oil passing through this chokepoint. Oil imported into Korea also comes through this strait.

Previously, investment bank JPMorgan Chase forecast that, in the event the Strait of Hormuz is blocked or armed conflict spreads across the Middle East, oil prices could reach as high as $130 per barrel in a worst-case scenario.

The surge in international oil prices could reignite inflation worldwide, which had only recently begun to ease after the COVID-19 pandemic. In particular, as the Trump administration's tariff policies are seen as weighing on employment and consumption, further increases in prices could worsen conditions into stagflation—the prolonged simultaneous stagnation and inflation that the US experienced in the 1970s.

Meanwhile, at a White House event, President Trump again emphasized he has no intention of dismissing Jerome Powell, chair of the US Federal Reserve (Fed), but also called him a "dummy" for not cutting rates. President Trump also mentioned, "If rates are cut by 2% points, the US could save $600 billion a year," raising concerns about the government’s borrowing costs.

New York = Park Shin-young, Correspondent nyusos@hankyung.com