Oil Surges as U.S.–Iran Tensions Escalate; Energy Stocks Lead

Oil prices spiked Monday after Washington laid out plans for a new blockade of Iran following the collapse of ceasefire talks, sending energy stocks sharply higher while the broader market slid. The S&P 500 fell 0.8% and the Nasdaq dropped 1.6%, while the S&P 500 energy sector rose about 3%.

Chevron gained roughly 5% on the week and Exxon rose 4% as the U.S. struck more than 80 Iranian targets and revoked the sanctions waiver covering Iranian oil exports, taking an estimated 1%–2% of global supply offline. BP has flagged 'exceptional' oil trading performance as the conflict chokes supply, with U.S. crude futures trading near $97 a barrel.

Analysts warn that even after flows resume, pre-conflict production and trade patterns may not fully recover until late 2026 or early 2027.