Oil prices have jumped more than 15%, topping $84, while European gas prices have surged over 30% after Iranian strikes on Qatari LNG facilities
© Getty Images/curraheeshutter
[RT] Global
energy markets have come under pressure as the Middle East conflict
escalates, with fears mounting over potential disruptions to oil and gas
supplies.
US and Israeli strikes on Iran have prompted Tehran
to retaliate with missile and drone attacks on Israel and US bases
across the region. Iran has also targeted oil facilities in neighboring
countries, while shipping through the Strait of Hormuz – the narrow
gateway at the mouth of the Gulf – has largely ground to a halt. The
waterway between Iran and Oman, just over 32km (20 miles) at its
narrowest point, is a critical chokepoint, carrying roughly 20% of the
world’s oil exports.
Is oil pricing in a wider war?
Oil prices
have surged more than 15% since the conflict began, extending gains on
Tuesday as the widening US-Israeli confrontation with Iran and threats
to shipping through the Strait of Hormuz fueled fears of broader supply
disruptions. Brent crude briefly topped $84 per barrel in early trading
on Tuesday, its highest level since mid-2024. The benchmark had hit
$82.37 in the previous session – its highest level since January 2025 –
before trimming some gains.
Traders are now pricing in a
significant risk premium amid concerns that escalating military actions
could restrict flows from major Gulf producers. Some analysts are
warning prices could test $90 per barrel if the waterway is disrupted.
Is Europe facing a fresh gas shock?
Natural
gas prices have surged even more dramatically, with the European
benchmark TTF futures jumping over 30% on Tuesday to exceed $700 per
1,000 cubic meters, the highest level since January 2023. The spike
follows Iran’s retaliatory strikes on Qatari liquefaction facilities,
prompting QatarEnergy – the world’s third-largest LNG exporter – to halt
production entirely. With roughly 20% of global LNG trade transiting
the Strait of Hormuz and Qatar’s export corridor having virtually no
bypass capacity, analysts warn of severe supply tightness.
Goldman
Sachs raised its April TTF forecast and cautioned that even a temporary
disruption could send European gas prices sharply higher, with
prolonged outages risking far more severe spikes. European storage
levels are currently well below their seasonal average, leaving the
region exposed to sustained supply losses.
The price of wholesale
gas in the UK has surged by 93%, according to Sky News, as analysts warn
that rising gas prices have a knock-on effect on the cost of renewables
and nuclear power. Analysts say that although the current spike is
smaller than in 2022 – when the cutoff of Russian gas sent energy bills
soaring – it is still set to hit consumers across Europe, as gas remains
central to power generation. Such a scenario would provide a boost to
Russian exporters and help the budget, but also increase volatility.
How is the Strait of Hormuz blockade affecting energy flows?
While
Iran did not formally close the Strait of Hormuz over the weekend, its
threats effectively halted shipping. Nervousness among oil and shipping
companies – and their insurers – brought traffic to a near standstill.
Brigadier
General Ebrahim Jabbari, a senior adviser to the Islamic Revolutionary
Guard Corps commander‑in‑chief, told state television on Monday: “Ships should not come to this region. They will certainly face a serious response from us. The Strait of Hormuz has been closed. We will attack and set ablaze any ship attempting to cross.” He added that oil pipelines could also be targeted and that Iran would not allow “a single drop of oil” to leave the region.
The
disruption has not only pushed global energy prices higher but also
sent shipping costs soaring. The charter rate for a supertanker carrying
oil from the Middle East to China hit a record $400,000 on Monday.
Ship
tracking data shows tanker traffic through the Gulf has largely halted,
with hundreds of vessels – including dozens of crude carriers moving
millions of barrels – anchored or idling on either side of the strait.
Operators are avoiding the area amid attacks and threats, with some very
large crude carriers alone representing about 2 million barrels each
waiting for the situation to ease. Experts say a prolonged closure is
unlikely, but a sustained disruption could push oil prices into triple
digits.
Are global markets sliding into risk-off mode?
Stocks
tumbled across Europe and Asia on Tuesday as the escalating Middle East
conflict and soaring energy prices rattled investors. Dow plunged 1,100
points in early trading on Tuesday as Wall Street fears a prolonged war
with Iran. Europe’s STOXX 600 extended losses for a second day, while
Germany’s DAX and France’s CAC 40 fell sharply, and London’s FTSE 100
hit a two-week low.
Asian markets fared worse. South Korea’s KOSPI
plunged more than 7% in its steepest drop in months as foreign
investors dumped shares, while Japan’s Nikkei also posted heavy losses
amid broad risk aversion.
How has the Russian market reacted to the escalating conflict?
The
geopolitical tensions have bolstered Russian energy companies, whose
shares have risen 3-12%. Analysts expect a narrowing of the discount on
Russian Urals crude and increased demand for liquefied natural gas
(LNG).
“Against this backdrop, forecasts of oil above $100 no longer seem marginal,”
Yaroslav Kabakov, director of strategy at Finam Group, told RBC on
Tuesday. He added that if the escalation continues, Brent could trade
between $85 and $95 per barrel over the coming weeks, with $100 or more
possible in the event of an actual blockade. Such a scenario would
provide a boost to Russian exporters and help the budget, but also
increase volatility.
Russia’s main stock exchange, MOEX, climbed
about 1.3% on Tuesday to its highest level since late 2025, led by
energy stocks. Tatneft rose nearly 11%, Rosneft 8.3%, and Lukoil 5.7%,
while Novatek gained around 5%. Other oil-linked names Surgutneftegaz
and Gazprom Neft also advanced.