Oil prices have surged overnight as the ongoing war in the Middle East continues to raise concerns about the global energy supply.
According to Trading Economics, West Texas Intermediate (WTI) crude jumped more than 10% to US$96 per barrel, while Brent crude climbed to US$101 per barrel.
The sharp move higher could set the stage for another strong session for Australian energy producers when the market opens.
Two ASX 200 companies that may attract attention today are Woodside Energy Group Ltd (ASX: WDS) and Santos Ltd (ASX: STO). Both stocks have already been rallying in recent weeks.
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Oil rally driven by supply fears
The surge in oil prices comes as geopolitical risks in the Middle East intensify.
Markets are focused on potential disruptions around the Strait of Hormuz, one of the world's most important energy transit routes.
According to the US Energy Information Administration, around 20 million barrels of oil and petroleum products pass through the Strait of Hormuz each day. This is equivalent to roughly 20% of global oil consumption.
The route is also critical for gas markets. Estimates indicate around 20% of global liquefied natural gas (LNG) trade moves through the strait, with much of it exported from Qatar to Asian markets.
Analysts warn that if the strait is significantly disrupted, millions of barrels of daily oil supply will be affected. Some forecasts suggest crude prices could climb toward US$120 per barrel or higher if exports from the Persian Gulf are halted.
Woodside shares already climbing
The oil rally has already been supporting the share price of Woodside.
Shares in Woodside recently closed at $31.05, giving the company a market capitalisation of about $59 billion.
Over the past month, the Woodside share price has climbed around 18%, as stronger oil prices improved investor sentiment toward energy producers.
Woodside is Australia's largest independent oil and gas company and generates significant revenue from LNG and crude production.
If the surge in crude continues, investors may expect further strength in the Woodside share price when trading begins.
Santos shares also gaining momentum
Shares in Santos have also been trending higher.
The Santos share price recently finished at $7.49, giving the company a market capitalisation of roughly $24 billion.
The stock has risen around 10% over the past month, supported by the rebound in global oil markets.
Foolish takeaway
The key question for energy investors is whether oil prices can keep rising.
With WTI crude trading US$96 per barrel, markets will be watching closely to see if prices push back above the US$100 level.
If geopolitical tensions remain elevated and supply risks continue, Woodside and Santos will likely remain in focus on the ASX today.
