The Middle East conflict has entered its third week, with a significant escalation in both intensity and geographic scope. Iran has expanded its operations beyond Israel, targeting Gulf countries including the UAE, Saudi Arabia, and Bahrain through coordinated drone and missile attacks.
The Middle East conflict has entered its third week, with a significant escalation in both intensity and geographic scope. Iran has expanded its operations beyond Israel, targeting Gulf countries including the UAE, Saudi Arabia, and Bahrain through coordinated drone and missile attacks.
Key energy infrastructure has been directly impacted, including Iran’s Kharg Island and the UAE’s Fujairah port both critical nodes in global oil logistics.
The conflict has already resulted in approximately 3,750 casualties and has effectively disrupted the Strait of Hormuz, through which nearly 20% of global oil supply transits. Additionally, Qatar’s LNG exports have been halted, and regional production has been impaired, triggering a severe supply shock.
Strait of Hormuz Crisis
The effective closure of the Strait of Hormuz has created an unprecedented disruption in global oil supply. U.S. strikes on Iranian export infrastructure and threats of further escalation have intensified market concerns.
In response:
Saudi Arabia is attempting to reroute up to 5 million barrels per day via Red Sea pipelines
The UAE’s Fujairah port—an alternative export route—has resumed operations after disruptions
The International Energy Agency (IEA) has announced the release of 400 million barrels from strategic reserves
However, with global oil demand at approximately 105 million barrels per day and around 20 million barrels affected, these reserves would only cover roughly 20 days of disrupted supply.
IEA Executive Director Fatih Birol emphasized that market stability depends on restoring transit through Hormuz, noting that reserve releases are only a short-term solution.
Brent crude surged to $119 per barrel last week. While further upside is expected, price action will likely remain highly volatile, driven by ongoing geopolitical developments.