Brent crude crossed $104 a barrel on Thursday, jumping more than 4% as fears of US strikes on Iran rattled energy markets. US West Texas Intermediate traded near $92.50.

The rally followed President Trump’s warning of a “massive armada” heading toward Iran and reports that Washington is weighing a resumption of strikes. Traders fear any conflict could disrupt supplies through the Strait of Hormuz.

About a fifth of the world’s oil passes through the strait, making it the most critical chokepoint in global energy trade. Even the threat of disruption is enough to send prices soaring.

Analysts warn that a sustained spike could feed inflation worldwide and complicate central banks’ plans. For India, which imports most of its oil, the surge is a double blow alongside the RBI’s rate hike.

OPEC has spare capacity it could deploy to calm markets, but analysts doubt the cartel will move before the situation clarifies. Prices could spike further if shipping through the strait is threatened.