Brent crude futures rose more than 1% Monday, settling at $97.31 a barrel after reaching $98.06 earlier in the session, its highest level since July 24. U.S. West Texas Intermediate crude settled at $92.65 after also climbing sharply.

The latest increase followed a weekend escalation in which U.S. forces struck three Iranian oil tankers after Iran launched missile attacks against U.S. Navy vessels, according to U.S. Central Command. Iranian officials condemned the strikes and warned of further retaliation.

Oil markets were further unsettled Monday after Saudi Aramco's Jazan oil refinery in Saudi Arabia was reportedly attacked. Damage was still being assessed, and it was not immediately clear who was responsible. The facility has the capacity to process roughly 400,000 barrels of crude per day.

The developments come as oil flows through the Strait of Hormuz remain sharply reduced. The strategic waterway is a major route for global energy shipments, and continued disruption has raised concerns about a broader supply shortage.

Analysts have warned that oil prices could rise substantially further if attacks on shipping routes intensify. The Financial Times reported that some analysts see prices potentially reaching $120 a barrel under a more severe disruption scenario.

The latest surge represents a major reversal from earlier in the summer. Brent had fallen to just above $70 a barrel in July after a ceasefire temporarily eased concerns about the conflict. It has since climbed rapidly as fighting resumed, and energy infrastructure and shipping routes came under renewed pressure.

The disruption is also affecting refined fuels. Diesel prices have risen particularly sharply, while gasoline and diesel prices in the United States have also been pushed higher by the increase in crude oil prices.

Traders are now watching whether the latest military exchanges remain limited or develop into sustained disruptions to oil production, refining and transportation across the Middle East. A prolonged disruption could put additional pressure on global energy supplies and fuel prices in the weeks ahead.