Mikkel Christensen
Global energy markets have been shaken by escalating tensions in the Middle East.
Global energy markets have been shaken by escalating tensions in the Middle East.
Investors are reacting to fears that the conflict could disrupt some of the world’s most critical energy supply routes.
Oil and gas prices jumped sharply as traders assessed the risk of prolonged supply interruptions.
European gas prices climbed by about 30 per cent on Monday as markets responded to the growing conflict involving Iran.
According to reports from the Belgian News Agency, the surge reflects concerns that fighting in the region could threaten shipments through the Strait of Hormuz.
The narrow shipping route is one of the most important energy corridors globally, carrying large volumes of crude oil and liquefied natural gas (LNG).
Europe faces pressure
Europe remains particularly vulnerable to disruptions in the LNG market.
Since pipeline imports from Russia dropped in recent years, European countries have increasingly relied on seaborne LNG to meet their energy needs.
At the same time, countries across the continent are rebuilding gas reserves after winter while competing with Asian buyers for available cargoes. Analysts warn that uncertainty around supply routes could tighten gas availability in the coming months.
Oil prices spike
Oil markets also reacted strongly to the geopolitical developments.
Brent crude, the global oil benchmark, briefly surged to 119.50 USD per barrel on Sunday night. That marked its steepest increase since April 2020 before prices retreated slightly.
By Monday morning, Brent was trading at around 108 USD per barrel, still roughly 17 per cent higher than at the end of the previous week. The US benchmark West Texas Intermediate followed a similar trajectory, rising above 104 USD after an initial spike.
Market jitters spread
Energy markets calmed slightly after reports that the G7 could consider releasing emergency oil reserves alongside the International Energy Agency.
US President Donald Trump attempted to reassure markets, writing on social media that the rise in prices was a “very small price” to pay for global security. He added that he expected energy costs to fall once the Iranian nuclear threat is resolved.
Meanwhile, the shock spread to financial markets in Asia. Japan’s Nikkei 225 index dropped more than six per cent shortly after trading began in Tokyo, while South Korea’s KOSPI fell by over seven per cent in early trading.
Sources: Belgian News Agency
