Iran War Puts Global Energy Markets on the Brink of a Worst-Case Scenario

The escalating conflict in Iran has pushed global energy markets toward a potentially catastrophic scenario, with significant implications for oil and gas supplies. Recent attacks have effectively closed the Strait of Hormuz, a critical shipping route for Middle Eastern oil and gas exports, causing oil prices to surge above $100 per barrel. While initial disruptions mainly involved halted shipments and storage issues, recent missile strikes—particularly by Israel on key facilities like the South Pars gas field and Iran’s retaliatory strikes on Qatar’s largest oil export terminal—have inflicted damage on vital energy infrastructure. Qatar, responsible for about 20% of the world’s liquefied natural gas supply, faces risks of long-term production losses, which could sustain elevated oil prices even after hostilities cease. Experts describe the situation as unprecedented and severe, likening it to a real-world war game with extreme consequences. The closure of the Strait of Hormuz and ongoing attacks threaten to remove from the market an amount of oil and gas comparable to the demand drop seen during the