Oil prices surged past $100 per barrel while global stock markets deepened their declines after Iran’s new supreme leader ordered the closure of the Strait of Hormuz.

Concerns over a prolonged conflict persisted as United States President Donald Trump stated that stopping the Islamic republic’s “evil empire” was more important than crude prices.

Global markets have faced turmoil since the United States and Israel initiated attacks on Iran.

Tehran responded with retaliatory strikes on shipping and Gulf neighbours, severely restricting maritime traffic through the Strait of Hormuz.

This chokepoint handles about one-fifth of the world’s oil and liquefied natural gas supplies.

“Oil prices are up by double-digit percentages again today, as the realisation sinks in that the US is not about to either end the war or institute some kind of convoy system in the region,” said analyst Chris Beauchamp at IG trading and investment platform.

Energy Secretary Chris Wright admitted the US military was currently “not ready” to escort tankers through the critical Strait of Hormuz.

Brent North Sea crude, the international benchmark, reached a peak of $101.59 per barrel on Thursday.

At $100 per barrel, Brent has risen around 38 percent since the conflict’s start on February 28, when the United States and Israel launched airstrikes against Iran.

It is up nearly two-thirds from the beginning of the year.

Iran’s new supreme leader Mojtaba Khamenei called on Thursday for using “the lever of blocking the Strait of Hormuz”, which the country’s Revolutionary Guards vowed to carry out.

This followed new attacks on Gulf energy targets, including an assault on two oil tankers off Iraq that killed at least one crew member, and a cargo ship that caught fire after being struck by shrapnel.

Oil prices later moderated their advances after Iran’s deputy foreign minister indicated that Tehran had permitted ships from some countries to transit the Strait of Hormuz.

The International Energy Agency described the Mideast war as “is creating the largest supply disruption in the history of the global oil market”.

This came a day after its member countries agreed to release 400 million barrels from their reserves—the largest such action ever.

Analyst David Morrison at Trade Nation remarked that if the announcements of the release of oil from strategic reserves “were supposed to cap prices, then they failed dismally”.

He added that the moves may have “suggested some panic as hostilities across the Middle East intensified”.

Elevated energy prices threaten broader economic inflation.

“The longer the oil price remains elevated, the more damaging and long lasting the inflation shock will be for the global economy,” noted Kathleen Brooks, research director at trading group XTB.

Wall Street’s major indices fell more than one percent in early afternoon trading.

Most European and Asian equity markets also closed lower.

eToro US investment analyst Bret Kenwell observed that while US equities had held up rather well to date, a long conflict would have a profound impact on businesses.

“If oil doesn’t retreat meaningfully, the pressure won’t just be felt at the pump — it will bleed into margins, spending, and potentially quarters of softer growth,” he said.

The dollar gained against major currencies.

“The dollar has strengthened, driven by safe-haven demand, fears of inflation, and higher-for-longer interest rate expectations,” said Victoria Scholar, head of investment at Interactive Investor.

Key figures at around 1630 GMT included:

Brent North Sea Crude: UP 8.6 percent at $99.88 per barrel

West Texas Intermediate: UP 9.3 percent at $95.38 per barrel

New York – Dow: DOWN 1.2 percent at 46,871.01 points

New York – S&P 500: DOWN 1.2 percent at 6,698.16

New York – Nasdaq Composite: DOWN 1.4 percent at 22,389.89

London – FTSE 100: DOWN 0.5 percent at 10,305.15 (close)

Paris – CAC 40: DOWN 0.8 percent at 7,978.98 (close)

Frankfurt – DAX: DOWN 0.2 percent at 23,589.65 (close)

Tokyo – Nikkei 225: DOWN 1.0 percent at 54,452.96 (close)

Hong Kong – Hang Seng Index: DOWN 0.7 percent at 25,716.76 (close)

Shanghai – Composite: DOWN 0.1 percent at 4,129.10 (close)

Euro/dollar: DOWN at $1.1525 from $1.1574 on Wednesday

Pound/dollar: DOWN at $1.3355 from $1.3419

Dollar/yen: UP at 159.20 yen from 158.92 yen

Euro/pound: UP at 86.31 pence from 86.25 pence