The ongoing conflict involving Iran has triggered a dramatic surge in global oil prices, pushing the cost of a barrel of Brent crude past the $90 mark for the first time since April 2024. The spike represents a more than 25% increase since hostilities began, marking the steepest weekly jump in oil prices since the early days of the Covid-19 pandemic. Markets around the world are now bracing for what could become a sustained period of energy-driven inflation.
Reports from Kuwait indicated that some oil fields had begun curtailing production due to a lack of available storage space, further tightening an already strained global supply. At its peak, Brent crude touched $91.89 per barrel on Friday, up sharply from roughly $72.50 just before the conflict erupted. Energy analysts warn that the situation could deteriorate further if storage facilities in neighboring Gulf nations also reach capacity.
Consultants monitoring the situation have estimated that holding facilities in Saudi Arabia and the United Arab Emirates could reach their limits within just 20 days. Should that happen, producers may be forced to shut down extraction operations entirely — a last resort that carries enormous economic consequences. Restarting halted oil wells is a costly and time-consuming process that can take weeks, compounding pressure on global supply chains.
Qatar’s energy minister added to the alarm by predicting that if the war continued without pause, all Gulf energy exporters could cease production within weeks, potentially sending oil prices soaring to $150 a barrel. Qatar, which accounts for roughly one-fifth of global liquefied natural gas exports, has already seen a key terminal damaged by an Iranian drone strike. Even an immediate ceasefire, the minister warned, would still leave the nation weeks or months away from resuming full LNG exports.
Financial markets have felt the full force of these developments. Stock indices in Asia-Pacific, Europe, and the UK all posted significant weekly losses, while government bond yields surged to levels not seen since major economic crises of recent years. UK interest rate cut expectations collapsed from 80% to just 15% in a matter of days, and airline stocks were among the hardest hit, with some carriers warning of hundreds of millions in lost profits.