Global Oil Prices Surge as Middle East Conflict Escalates 📈

• Overall Price Impact: Crude oil prices climbed significantly in early Asian trading on Monday due to expanding military actions in Lebanon. West Texas Intermediate (WTI) rose by 2.43% to $89.88 per barrel, while Brent crude increased by 2.88% to trade at $93.33 per barrel. • Key Geopolitical Drivers: Over the weekend, Israeli troops expanded operations north of the Litani River and captured the strategic Beaufort Castle. This military escalation directly threatens the stability of U.S.-hosted peace talks in Washington and compounds existing market anxiety. • Supply Risks & The National Context: Upside risks for oil markets remain high following the previous closure of the Strait of Hormuz by Iran. For Sri Lanka's economy, prolonged high energy costs typically pressure foreign reserves and intensify domestic inflationary pressures across key export sectors like apparel & textiles and tea logistics. While President Trump noted a pending determination on an Iranian ceasefire framework, no deal has been signed. • Demand Indicators: The price surge occurred despite weekend data showing sluggish Chinese factory activity and deflationary pressures. While weaker demand from China—the world's second-largest economy—would normally depress prices, Middle East supply risks currently remain the dominant market driver. _(Based on provisional market data)_