The most-traded May iron ore contract on China's Dalian Commodity Exchange (DCE) DCIOcv1 traded 3% higher at 790 yuan ($114.19) a metric ton, as of 02:47 GMT.
The benchmark April iron ore SZZFJ6on the Singapore Exchange was 2.13% higher at $103.75 a ton.
Oil prices surged about 20% on Monday as the expanding US-Israeli war with Iran led some major Middle Eastern oil producers to cut supplies. Fears of prolonged disruption to shipping through the Strait of Hormuz chokepoint also contributed to the price action.
Surging energy costs will push up costs related to bunker fuel, insurance, and war risk premium, said managing director at Navigate Commodities Atilla Widnell.
In the medium-to-long term, however, the risk of central banks raising interest rates again to curb inflation risks becomes more likely, dampening the outlook for iron ore and steel, he added.
