Is the conflict in Iran going to increase oil and gas prices?
Asked 11 days ago
Answer
The conflict in Iran is already causing increases in oil and gas prices, with fears of further spikes if the Strait of Hormuz is closed or disrupted. This strait is a critical route for about a fifth to a quarter of the world's oil and gas, and any blockage or heightened risk could push prices above $100 per barrel, fuel inflation, and disrupt global supply chains. The effects are being felt globally, with regions like Europe, Africa, and Australia anticipating or experiencing higher energy costs and inflation.
References
If there is a serious interruption of oil and gas flows out of the Gulf, oil prices could go to $100 a barrel or more. The Iranian parliament has passed a motion to close the Strait of Hormuz, raising concerns about energy supply disruptions.
Oil prices have risen to their highest since January due to fears Iran may close the Strait of Hormuz, a vital oil shipping route. If disrupted, oil prices could reach $100 per barrel, fueling global inflation and higher gasoline prices.
The conflict is expected to raise energy prices in Africa, with predictions of a $10 surge in benchmark crude prices and the threat of the Strait of Hormuz's closure potentially sending oil prices skyrocketing, leading to inflation and fuel shortages.
A fifth of the world's oil, fertilizer, and gas supplies pass through the Strait of Hormuz. Iran has threatened to close it in response to existential threats, which could drive oil prices higher and disrupt global energy supplies.