Oil futures surged above $110 a barrel Monday as escalating tensions in the Middle East rattled global markets, sending Asian stocks sharply lower, with all of the region’s markets opening deep in the red, even as bitcoin held steady near $67,000.
West Texas Intermediate crude jumped roughly 17% in 24 hours. Japan’s Nikkei 225 fell more than 6% and South Korea’s Kospi dropped about 8% as traders repriced energy costs across import-dependent economies.
The rally centers on the risk that fighting could restrict oil flows near the Strait of Hormuz, the chokepoint through which roughly 20% of global crude supply passes daily. Prediction markets on Polymarket assign a 76% probability that crude reaches $120 by the end of March.
Bitcoin traded around $67,000 with little sign of panic selling. Ether and solana posted modest gains, suggesting crypto markets have so far treated the spike as an energy-specific shock rather than a broad risk-off event.
Not all traders are convinced the move has legs. Funding rates on oil perpetual futures turned negative on Hyperliquid, indicating significant positioning for a pullback even as spot prices climb.
Markets still see little chance of an imminent rate cut.
Contracts on Polymarket show a roughly 98% probability that the Federal Reserve leaves rates unchanged at its March 18 meeting, with only about a 12% chance of a 25-basis-point cut by the end of April.
A sustained rally in crude would reinforce inflation pressures, something that the Fed would have to consider when setting rates.