Next stop is $120 per barrel, analysts fear: File Image/Pixabay

U.S. president Donald Trump’s military attack on Iran sent oil prices skyrocketing by 9 percent on Sunday, as analysts regarded a bottleneck of tankers in the Strait of Hormuz as a strong sign that supply disruptions were imminent.

As of 23:41 GMT, Brent jumped $6.54, or 9 percent, to $79.41 per barrel, while West Texas Intermediate climbed $5.55, or 8 percent, to $72.57.

According to Rystad Energy, tanker traffic through the Strait had halted on Sunday as a precautionary measure, although Matt Smith, oil analyst at Kpler, said, “Tankers are definitely spooked.”

As of Sunday afternoon, S&P Global Energy’s Commodities at Sea calculated that six tankers carrying energy products had traveled through the strait, down from 65 on Friday; meanwhile, videos verified by The New York Times showed a tanker ablaze while anchored near Oman, and another vessel was also reportedly struck in the area.

Shortly after it was announced that Iran’s supreme leader, Ayatollah Ali Khamenei, and other top Islamic republic officials had been killed in the massive airstrikes, Barclays told clients in a note that Brent could hit $100 per barrel, but UBS believed that material disruptions could send spot prices of the benchmarks above $120 per barrel.

However, Trump repeatedly stated his intention to avoid a prolonged attack, and responded positively to an unnamed party within Iran that approached Washington with the intention of forming a new government – thus leaving open the possibility of near-term de-escalation.

Still, retaliatory attacks by Iran on neighbouring countries prompted the formation of a statement  issued by the governments of the U.S., Bahrain, Jordan, Kuwait, Qatar, Saudi Arabia and the United Arab Emirates declaring a unified front against Tehran, implying that a regional war could be in the offing.

As of late Sunday, no major energy assets in the region appeared to have been struck, causing Amy Myers Jaffe, director of the Energy, Climate Justice and Sustainability Lab at New York University, to say, “The biggest question is what, if any, oil installations get damaged; if the answer to that is none, my opinion is the price of oil will come back down.”

Jason Bordoff, the founding director of the Center on Global Energy Policy at Columbia University, urged calm by remarking that “even with a massive strike on Iran that killed the leader of the country, at this point we’re still talking about oil prices that are well within historical norms — and much less than one would have ever expected with a strike of this magnitude.”

As for U.S. prices at the pump, Patrick De Haan, analyst at GasBuddy, warned, "I fully expect that by Monday night, you could credibly say that gas prices are being impacted by oil prices having gone up," and although he said it won’t be a spike, further price hikes will likely occur later this week.