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Energy Supply · Geopolitics · Middle East Conflict · Oil Prices
Escalating conflict between the U.S. and Iran has triggered a significant surge in global oil prices, with Brent crude rising 2.1% to $83.12 and U.S. West Texas Intermediate (WTI) up 2.6% to $76.61.
The widening geopolitical tensions have led to severe supply disruptions, most notably the effective closure of the Strait of Hormuz, a critical chokepoint for global oil trade, stranding hundreds of tankers. Iraq, OPEC's second-largest producer, has already cut output by 1.5 million barrels per day due to blocked export routes and storage limitations, with potential for further cuts of 3.3 million bpd if the Strait remains closed.
Qatar has also declared force majeure on LNG exports, impacting global gas supplies. The supply crunch is evident in European diesel futures hitting a two-year high of $1,130 and Chinese and Indian refineries halting crude units due to their reliance on Middle East imports.
The ongoing conflict, marked by attacks on tankers and military engagements, signals sustained volatility and heightened risk for energy markets.
