The jump in oil prices following Israel's strikes on Iran could exacerbate stagflationary conditions if they persist, according to Apollo Global Management.

The closure of the Strait of Hormuz would cause oil prices to surge and trigger a sharp slowdown in economic growth, economists have warned.

Rather, it is geopolitical factors—specifically, escalating tensions in the Middle East—that are unsettling markets and pushing prices higher.

Geopolitical tensions in the Middle East could drive oil prices as high as $120 per barrel according to JP Morgan, benefiting Exxon Mobil's earnings outlook. Applying the Graham Number, Exxon Mobil's intrinsic value ranges from $103 to $134 per share, depending on EPS scenarios.

Oil prices are rising and stocks are falling on worries that Israel's attack on Iranian nuclear sites could damage flow of crude around the world.

That sent the yield on the 10-year Treasury up to 4.43% from 4.36% late Thursday. Higher yields can tug down on prices for stocks and other investments, while making it more expensive for U.S. companies and households to borrow money.

A sharp rise in global oil prices following Israeli strikes on Iran will benefit Russia and bolster its military capabilities in the war in Ukraine, Ukrainian President Volodymyr Zelenskyy said Friday in comments that were under embargo until Saturday afternoon.

The local sharemarket is set to follow Wall Street lower on Monday as investors brace for wild swings in oil prices amid escalating tensions in the Middle East.