IRIA News

8 minute read

Global oil prices surged above $100 per barrel on March 9, 2026, as the war involving the United States, Israel, and Iran intensified, raising fears of a major disruption to the world’s energy supply and triggering sharp declines in global financial markets.

Brent crude, the international benchmark, jumped more than 30 percent on Sunday, briefly climbing above $119 per barrel before easing slightly to around $110. U.S. West Texas Intermediate crude also rose sharply, at one point reaching nearly $119 before pulling back.

The surge marked the first time oil had crossed the $100 threshold since Russia’s invasion of Ukraine in 2022, highlighting the scale of the current shock to global energy markets.

Oil prices later eased after reports that finance ministers from the Group of Seven (G7) economies would hold an emergency meeting to discuss a coordinated release of petroleum reserves with the International Energy Agency to stabilize markets.

War Drives Energy Shock

Oil prices have climbed roughly 50 percent since February 28, when the United States and Israel launched joint strikes against Iran. The conflict has rapidly expanded across the region, with attacks on energy infrastructure and shipping routes threatening a significant portion of global oil supply.

One of the most critical developments has been the effective shutdown of shipping through the Strait of Hormuz, a strategic maritime corridor through which roughly 20 percent of the world’s oil and gas normally passes.

Iran halted most shipping traffic in the strait as part of its retaliation against U.S. and Israeli strikes. The move has created a backlog of crude shipments across the Gulf and forced several major producers to scale back production.

Iraq, Kuwait, and the United Arab Emirates have already begun reducing output as storage facilities fill up with oil that cannot be exported due to the disruption in maritime traffic. Analysts warn that Saudi Arabia could also face production constraints if the closure continues.

Neil Atkinson, former head of oil markets at the International Energy Agency, warned the situation could become unprecedented. “Unless something changes very soon, we are in a potentially game-changing and unprecedented energy crisis,” he said.

Asked how high prices could climb, Atkinson said there was no clear historical comparison. “Sorry, we are getting into the realms of educated guesswork here. I mean, there is no precedent for this. The sky is the limit.”

Energy Facilities Under Attack

The energy crisis has been intensified by direct attacks on oil infrastructure across the Middle East. Over the weekend, Israeli aircraft struck Iranian oil infrastructure for the first time since the war began. According to Iranian state media, the strikes hit four oil storage facilities and an oil transfer center in Tehran and the nearby province of Alborz.

The attack sparked large fires at the Shahran oil depot in Tehran, damaging fuel tankers and vehicles. Iran has also been blamed for a series of attacks on energy facilities across the Gulf. On Monday, Iranian strikes targeted energy installations in several countries, including a major petroleum complex in Bahrain.

The Al Ma’ameer oil facility was hit, causing a fire and forcing Bahrain’s state-owned energy company Bapco to declare force majeure, a legal clause allowing exporters to suspend contractual obligations due to extraordinary circumstances.

Energy companies in Qatar and Kuwait have also issued similar warnings that ongoing attacks could prevent them from meeting export commitments.

The first strike on Iranian oil infrastructure just landed. Not on Kharg Island, where Iran loads crude for export. Not on the southern oil fields of Khuzestan, where crude comes out of the ground. On the Shahran fuel depot on the northern outskirts of Tehran, where gasoline and… pic.twitter.com/7ikhvYH01L

— Shanaka Anslem Perera ⚡ (@shanaka86) March 8, 2026

Iran’s Revolutionary Guard Corps warned that energy facilities across the region could become targets if the conflict continues.

The group said oil prices could reach $200 per barrel if the United States and Israel “continue this game.” Producers Face Shutdown Risks

The disruption to shipping routes has created a growing logistical crisis for oil producers. With tankers unable to move through the Strait of Hormuz, crude oil is accumulating in storage facilities across the region. Analysts say this could soon force producers to shut down wells simply because there is no place left to store the oil.

Janiv Shah, vice president of oil markets at Rystad Energy, said Brent crude could reach $135 per barrel if the current situation persists for several months.

“The market is currently grappling with physical supply being choked off by drone strikes, while Middle Eastern producers are simultaneously hitting a critical point where they must shut in production simply because there is nowhere left to put the oil,” Shah said.

Analysts at Societe Generale warned that the United Arab Emirates could be the next producer forced to halt output within the coming week if the situation does not improve.

Qatar’s Energy Minister Saad Al Kaabi also warned that a wider shutdown of Gulf energy exports could soon occur.

“Everybody who has not called for force majeure we expect will do so in the next few days if this continues,” he said. “All exporters in the Gulf region will have to call a force majeure.”

Markets React to Energy Shock

Financial markets reacted sharply to the surge in oil prices and fears of a prolonged conflict. Asian stock markets fell steeply on Monday. Japan’s Nikkei 225 dropped more than 5 percent after falling as much as 7 percent earlier in the day. South Korea’s KOSPI index also tumbled, closing down about 6 percent after an earlier drop of 8 percent.

In Hong Kong, the Hang Seng Index declined by more than 1 percent. European markets also opened lower. London’s FTSE 100 fell roughly 2 percent, while Germany’s DAX dropped around 3 percent.

U.S. stock futures pointed to further losses, with futures tied to the S&P 500 falling about 1.7 percent and Nasdaq futures dropping nearly 1.9 percent.

Analysts said the surge in oil prices could have significant economic consequences if it persists.

According to the International Monetary Fund, every sustained 10 percent increase in oil prices typically raises global inflation by about 0.4 percent and reduces economic growth by roughly 0.15 percent.

“If the shock proves short-lived, the global economy can quickly recover,” said Mike O’Rourke, chief market strategist at JonesTrading.

“If oil remains at these levels for several weeks, it will be a major global headwind. Thus far, markets have underestimated the risks related to the conflict in Iran.”

Political Response

Despite the spike in prices, U.S. officials have attempted to reassure markets that the situation will stabilize. President Donald Trump said higher oil prices were a temporary cost associated with eliminating Iran’s nuclear threat.

“Short-term oil prices, which will drop rapidly when the destruction of the Iran nuclear threat is over, is a very small price to pay for U.S.A., and World, Safety and Peace,” Trump said in a post on Truth Social. “ONLY FOOLS WOULD THINK DIFFERENTLY!” he added.

U.S. Energy Secretary Chris Wright also said the impact on consumers would likely be limited. Speaking on CBS News’ Face the Nation program, Wright said any increase in gasoline prices at the pump would be “temporary.”

However, many analysts remain skeptical that the situation will stabilize quickly, especially if shipping through the Strait of Hormuz remains blocked.

Tyler Goodspeed, chief economist at ExxonMobil, said the risk of a prolonged disruption may be higher than markets initially assumed.

“When I think of the probability distribution of possible outcomes here, it seems to me there are many more scenarios, and more probable scenarios, in which the strait remains effectively closed harder for longer than there are scenarios in which normal traffic resumes,” he said.

As the war enters its second week, energy markets remain on edge, with traders closely watching the Strait of Hormuz and the broader Middle East for signs of either escalation or de-escalation that could determine the direction of oil prices in the weeks ahead.