Oil futures surged above $110 a barrel on Monday as escalating tensions in the Middle East roiled global markets, sending Asian stocks tumbling, with all markets in the region opening in the red, although bitcoin held steady near $67,000.
West Texas Intermediate crude jumped about 17% in 24 hours. Japan’s Nikkei 225 index fell more than 6% and South Korea’s Kospi fell about 8% as traders reassessed energy costs in import-dependent economies.
The rally focuses on the risk that fighting will limit oil flows near the Strait of Hormuz, the chokepoint through which about 20% of the world’s crude supply passes daily. Prediction markets on Polymarket assign a 76% probability that crude will hit $120 by the end of March.
Bitcoin traded at around $67,000 with little sign of panic selling. Ether and Solana posted modest gains, suggesting that crypto markets have so far treated the spike as an energy-specific shock rather than a broad risk-aversion event.
Not all traders are convinced that this decision carries weight. Funding rates for perpetual oil futures have turned negative on Hyperliquid, indicating significant positioning for a pullback even if spot prices climb.
Markets still see little chance of an imminent rate cut.
Contracts on Polymarket show about a 98% chance that the Federal Reserve will leave 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 recovery in crude oil would add to inflationary pressures, something the Fed should take into account when setting rates.
