LONDON, March 3 (Reuters) – Global oil and gas prices rose on Tuesday as the United States and Israel’s war against Iran disrupted energy exports from the Middle East, with Tehran attacking ships and energy facilities, closing shipping in the Gulf and forcing a halt to production from Qatar to Iraq.
Oil prices have risen more than 15% since Friday and the benchmark Brent contract 🏽 gained 6% on Tuesday to more than $82 per barrel, the highest since July 2024, while European gas prices rose 40%, adding to a 40% increase on Monday. The prices of sugar, fertilizers and soybeans also rose.
The conflict risks triggering a new rise in inflation that could stifle economic recovery in Europe and Asia, if the war prolongs in a region that represents just under a third of the world’s oil production and almost a fifth of natural gas.
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Maritime traffic through the Strait of Hormuz was closed for the fourth day in a row after Iran attacked five ships, blocking a key artery responsible for about 20% of global oil and gas supplies.
This Tuesday, a fuel tank at the commercial port of Duqm, in Oman, was hit and a fire broke out in Fujairah, in the United Arab Emirates, one of the main regional oil centers.
On Monday, Qatar closed its liquefied natural gas facilities, some of the largest in the world, which supply about 20% of global LNG exports, Saudi Arabia suspended production at its largest domestic refinery, while Israel and Iraqi Kurdistan also shut down much of their gas and oil production.
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US President Donald Trump on Saturday launched the biggest foreign policy gamble of his term so far, attacking Iran and killing Supreme Leader Ali Khamenei.
In the US, where gasoline prices are a key political pressure point, the cost jumped above $3 per gallon for the first time since November, just weeks after Trump touted his achievements in lowering prices to $2.
Higher prices at gas stations pose a major risk to Trump and his Republican counterparts as they prepare for the midterm elections in November, with many Americans struggling to keep up with the rising costs of everyday products.
US Treasury Secretary Scott Bessent and Energy Secretary Chris Wright will announce plans on Tuesday to mitigate the impact of rising prices on Americans, said US Secretary of State Marco Rubio.
India, one of the most oil and gas-dependent countries in the Middle East, said it began rationing gas supplies to industries after Qatar halted production.
Most of Qatar’s LNG is directed to Asia, but some is also sent to Europe, which relies entirely on imports to meet its oil and gas needs. Europe is expected to rush to replenish its stocks, depleted by a harsh winter, and will need to rely even more on US gas after rejecting Russian gas following the 2022 invasion of Ukraine.
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Freight rates around the world also hit an all-time high as the conflict intensified and Tehran began attacking ships passing through the Strait of Hormuz.
The closure of the Strait of Hormuz has left hundreds of tankers loaded with oil and LNG stranded near major hubs such as the port of Fujairah in the United Arab Emirates, unable to reach customers in Asia, Europe and elsewhere.
