Due to the US-Israel war, oil prices have risen by 30% in one week. Analysts warn that this is not the limit.
Modern.az reports, citing Bloomberg, that the chaos in the oil market due to the war in the Middle East is intensifying daily. Analysts expect a complete halt in production in Iran, a continued blockade of the Strait of Hormuz, and an increase in the scale of mutual attacks between the two sides. This will prolong the disruption of oil supplies from the region's countries and will likely push crude oil prices above $200 per barrel.
Several countries affected by Iran's attacks have already started to reduce oil production: first Iraq, followed by the United Arab Emirates (UAE) and Kuwait have taken this step. The chain reaction may continue: tankers are wary of entering the Strait of Hormuz, which reduces the number of empty vessels available for loading. Bloomberg reports that once tanker tanks are depleted, the remaining capacity in the region's land-based storage facilities will fill up even faster.
The crisis shows no signs of a quick resolution. In peacetime, up to one-fifth of the world's seaborne oil passes through the Strait of Hormuz, and chaos will continue as long as the strait remains closed. In recent days, only Iran-linked tankers and two Chinese cargo ships have been observed in the strait.
Theoretically, only one-third of the region's production can pass through the strait. Saudi Arabia is particularly eager to utilize this and has already diverted large volumes of oil to the Red Sea coast for increased exports this week.
Iran is not the only country showing unwillingness to compromise: on March 7, Donald Trump announced stronger bombing campaigns against the Islamic Republic. For analysts and oil traders, this is a clear signal that the war will push crude oil prices to the psychological threshold of $100 per barrel for Brent crude.
In some markets, the "oil at $100" scenario has already materialized. For example, Abu Dhabi Murban crude oil futures reached $103 per barrel on Friday, March 6. Oman crude oil rose to $107. Chinese crude oil futures on the Shanghai Energy Exchange closed at $109.
As former trader Stefano Grasson noted in a Bloomberg commentary, every day of disruption increases pressure on markets: "In this scenario, there is no ceiling for prices in the short term."
On the one hand, the threat to oil infrastructure from strikes remains. Just this weekend, Saudi Arabia intercepted Iranian drones approaching a field with a daily production capacity of one million barrels; strikes also hit Bahrain and Qatar.
On the other hand, exporters are wary of entering the Strait of Hormuz. The US promises financial protection and reinsurance to exporters, but a more effective guarantee would be the escort of tankers by military vessels, and ideally, a cessation of military operations is desired.
Donald Trump dismisses concerns about inflation and other risks, despite the sharp rise in gasoline prices in the US currently. "We assumed oil prices would rise, which they did; but they will also fall, and they will fall very quickly," the US president stated.
India, one of the world's largest importers, received temporary permission from the US this week to resume purchases of Russian oil. Washington was also considering using its strategic petroleum reserve. However, such steps have not yet been taken.
In Japan, which obtains over 90% of its oil from the war-affected region, oil refineries have already requested the use of crude oil from the national reserve. Other countries, including China, have reduced fuel exports to protect supplies and keep domestic prices under control.
South Korea is considering imposing a cap on oil prices for the first time in 30 years.
China has bought a lot of cheap oil from Iran. However, due to the war, it faces the risk of losing it, just as it lost favorable supplies from Venezuela.
The war between the US and Israel with Iran is rapidly escalating, and its course is difficult to predict. However, it is already possible to identify one of the main losers from the fighting: China. In 2025, approximately one-fifth of China's oil imports came from Iran and Venezuela, which recently faced American intervention. Now, these supplies are at best questionable, and this primarily benefits Russia, which is ready to increase oil exports to China, the article states.
