Oil jumped back above $70 a barrel after Iran attacked two U.S.-Iraqi airbases in its first response to the killing of a top general, sparking fears the deepening conflict will disrupt global crude supplies.

Futures in London surged more than 5% to the highest since May as the Islamic Revolutionary Guard Corps claimed responsibility for the missile strikes, which the Pentagon said were launched from Iran and targeted the Ayn al-Asad base in western Iraq and another facility in Erbil. Prices later pared more than half their advance after Iran’s foreign minister said it had “concluded proportionate measures in self-defense” and is not seeking war.

While flows from the Middle East continue to be unimpeded for now, the risk of disruption is spooking the oil market. Most crude exports from Saudi Arabia, Iran and Iraq, which collectively pumped more than 16 million barrels of oil a day in December, go through the Strait of Hormuz, a narrow waterway that Iran has repeatedly threatened to shut down if there’s a war.

The impact of the strike also spilled over into other assets, with gold surging to the highest to the highest level in six years, while U.S. stock futures slumped along with Asian equities. Treasuries and the yen rose.

Oil’s had a dramatic start to the year since a U.S. airstrike killed General Qassem Soleimani last week. Iran said Tuesday it was assessing 13 possible ways to inflict a “historic nightmare” on America after the assassination of the powerful military commander near Baghdad’s international airport.

“It’s not going to be pretty today,” said Stephen Innes, Asia market strategist at AxiTrader Ltd. “The market is intensifying its responsiveness to supply risk as oil prices rocket higher with risk premia predictably in short supply.”

Brent crude rose as much as $3.48 to $71.75 a barrel before trading up 1.6% at $69.34 on the ICE Futures Europe exchange as of 10:51 a.m. in Singapore. West Texas Intermediate rose as much as $2.95, or 4.7%, to $65.65 on the New York Mercantile Exchange and later retreated to $63.49 a barrel.

Investors are paying up to protect against higher prices after the strikes. Call options on WTI – which allow the holder to buy futures at a set price – are at the biggest premium to puts since September, when it spiked in the wake of attacks on Saudi Arabian oil sites. Implied volatility – a key measure of how expensive the options are – reached the highest since early December.

While there’s nervousness around the safety of shipments through the Strait of Hormuz, there’s still a comfortable oil supply cushion. OPEC is sitting on huge amounts of spare capacity after reducing supplies for most of the past three years and the U.S., the world’s largest crude producer, recently reported its first ever full month as a net exporter. Big oil consumers including the U.S. and China also hold millions of barrels in strategic reserves that can be deployed to offset any shortage.

“We have to wait for the dust to settle,” said Phil Flynn, a senior markets analyst at Price Futures Group. It’s risk premium driving oil prices at this stage because oil facilities haven’t been attacked yet, he said.

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