The European Commission sees no immediate impact on the European Union's security of oil supply from the escalating conflict in the Middle East, it said in an email to EU governments, seen by Reuters on Monday (2 March).
"At this stage, we do not foresee an immediate oil SOS (security of supply) impact," the Commission email said.
The Commission is considering convening an ad-hoc meeting of its Oil Coordination Group later this week. Member states have been asked to share their assessments of oil supply security by the end of the day on Monday.
Romania has reported having enough fuel reserves for 30 days and stated that all measures are in place to prevent price surges.
Shipping companies are wary of attacks and unable to obtain insurance against conflicts as this crucial waterway handles around 20% of the world’s oil and gas.
Jorge Leon, head of geopolitical analysis at Rystad Energy, said, "The most immediate and tangible development affecting oil markets is the effective halt of traffic through the Strait of Hormuz, preventing 15 million barrels per day of crude oil from reaching markets. Unless de-escalation signals emerge swiftly, we expect a significant upward repricing of oil."
Military strikes by the United States and Israel on Iran continue, while Iran has responded with missile barrages.
President Donald Trump suggested to the UK's Daily Mail that the conflict could last four more weeks, with attacks continuing until U.S. objectives are met.
While the Strait of Hormuz has not been blocked, its strategic importance, handling around a fifth of the world’s seaborne oil trade and 20% of liquefied natural gas-means any disruption can significantly impact global energy markets.
A prolonged spike in oil prices could reignite inflationary pressures globally, acting as a tax on businesses and consumers and potentially dampening demand.
OPEC+ agreed to a modest oil output boost of 206,000 barrels per day for April, but much of that product still needs to leave the Middle East by tanker.
Alan Gelder, SVP of refining, chemicals and oil markets at Wood Mackenzie, said: "The nearest historical analogue is the Middle East oil embargo of the 1970s, which increased oil prices by 300% to around $12/bbl in 1974. That is only US$90/bbl in 2026 terms. Eclipsing this in today’s market, given significant supply losses, seems very achievable."
Brent crude LCOc1 was last up 9% at $78.9 a barrel, set for its biggest daily jump since 2020's COVID-19-related turbulence and just surpassing its surge after Russia launched its full-scale invasion of Ukraine in 2022. Benchmark European gas prices surged 37.5% to one-year highs.
In the Middle East, the UAE and Kuwait temporarily closed their stock markets citing "exceptional circumstances".
The oil shock rippled through currency markets with the dollar a main beneficiary. The U.S. is a net energy exporter and Treasuries are still considered a liquid haven in times of stress, shoving the euro down 0.2% to $1.1787 EUR=EBS.
While the Japanese yen is often a safe harbour, the country imports all of its oil making the flows more two-way. The dollar added 0.3% to 156.44 yen JPY=EBS.
Bonds attracted fresh buying on Friday after UK mortgage lender MFS was placed into administration amid allegations of financial irregularities. Its collapse stoked wider credit fears, with well-known big banks among its lenders. MFS had borrowed £2 billion ($2.69 billion).
Iran’s Revolutionary Guards (IRGC) said they struck a cargo ship owned by the “American-Zionist enemy” with a cruise missile after an Iranian fr...
Kazakhstan has restored oil production after an accident at the Tengiz oil field briefly disrupted output last week, while also signalling its readine...
Baku has once again become a focal point for international energy diplomacy, investment and strategic cooperation, as Baku Energy Week brings together...
Dutch police have launched an investigation into the use of force against a pregnant woman at an asylum seekers' centre in Zeist after videos of the i...
Trump reportedly lashed out at Netanyahu on Monday over Israel's escalation in Lebanon, describing the Israeli leader as "crazy" and warning that furt...
Wall Street ended sharply lower on Tuesday as investors worried about artificial intelligence (AI) creating more competition for software makers, keeping them on edge ahead of quarterly reports from Alphabet and Amazon later this week.
U.S. stock markets finished mixed on Wednesday (28 January) as investors reacted calmly after the Federal Reserve left interest rates unchanged, a decision that had been widely expected and largely priced in.
Wall Street closed sharply lower on Tuesday as global markets fell after U.S. President Donald Trump’s new tariff threats against Europe unsettled investors and revived fears of renewed volatility.
Wall Street closed higher on Tuesday, boosted by optimism over artificial intelligence (AI) and a strong rally in Moderna shares, with the Dow Jones Industrial Average approaching a record high.
Okinawa lost transport links and suffered widespread power outages on Monday (1 June) as Severe Tropical Storm Jangmi brought destructive winds and heavy rain to Japan's south-western islands.
Competing narratives continue to shape perceptions of the war in Ukraine, with Russian leadership suggesting a possible end phase while Ukrainian officials warn of renewed large-scale attacks and ongoing escalation risks.
U.S. Secretary of State Marco Rubio has held talks with Lebanese President and Israeli Prime Minister on efforts to ease tensions between Israel and Lebanon. According to a U.S. official, Washington has proposed a plan aimed at achieving a gradual de-escalation of hostilities.
When Armenians vote on 7 June, they will be voting in an election shaped by months of political change and a rapidly deepening relationship with the European Union. The result may not only determine who governs Armenia but also the future direction of the country's geopolitical alignment.
Unsealed records from the U.S. Department of Justice have renewed scrutiny of lawyer Robert Amsterdam after documents revealed communications between his law firm and Jeffrey Epstein's office. The disclosures have drawn attention because of Amsterdam's prominent role in Armenia.
The International Labour Organization (ILO) has begun its latest round of negotiations on creating the first binding global standards for platform-based work, covering services such as ride-hailing, food delivery and other app-based work.
European companies are continuing to deepen their presence in China, with nearly seven in ten firms maintaining or expanding their supply chains despite global efforts to diversify, according to a new survey by the EU Chamber of Commerce.
BP has removed its chair, Albert Manifold, with immediate effect, citing concerns over governance and conduct. The company said its board had unanimously decided that Manifold should no longer serve as chair or director.
The dual-class share structure outlined in SpaceX’s initial public offering (IPO) filing, which gives chief executive Elon Musk outsized control, has reignited one of Wall Street’s longest-running debates over corporate governance.
Kevin Warsh will be sworn in as chair of the U.S. Federal Reserve on Friday as policymakers consider higher interest rates to tackle inflation linked to the Trump administration’s Iran policy.
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