Energy prices surged Monday as the war in the Middle East led to outages of key energy production operations and a critical waterway was essentially emptied of traffic.
European natural gas prices finished the day up more than 39 per cent after surging more than 50 percent earlier in the day.
Brent oil futures rose to above $82 a barrel, a gain of more than 13 per cent early in the session. The benchmark finished up 7.3 per cent at $77.74 a barrel, up around $15 compared with the start of 2026.
US benchmark West Texas Intermediate ended at $71.23 a barrel, up 6.3 per cent.
The surge in prices comes as key energy facilities emerge as targets in the war.
Qatar’s state-run energy firm said it had halted liquefied natural gas production following Iranian attacks on facilities at two of its main gas processing bases.
Earlier, the massive Ras Tanura refinery on Saudi Arabia’s Gulf coast went into partial shutdown after a strike by drones led to a fire.
A terminal in Abu Dhabi was also attacked by a drone.
In parallel, energy markets are also absorbing a de facto halt to traffic in the Strait of Hormuz, through which about 20 percent of global supply of oil and LNG travels.
The waterway has not technically been closed, but major maritime companies have suspended travel through it as insurance costs soar amid heightened risk.
Since Israel and the United States launched strikes on Iran on Saturday, the world’s largest shipping firms — Italian-Swiss MSC, Denmark’s Maersk, France’s CMA CGM, Germany’s Hapag-Lloyd, and China’s Cosco — have ordered their ships to find shelter and stay safe.
The exodus of ships from the waterway will prevent some 15 million barrels per day of oil from reaching global markets, estimated Rystad Energy senior vice president Jorge Leon.
“Whether the Strait is closed by force or rendered inaccessible by risk avoidance, the impact on flows is largely the same,” Leon said in a note. “Nations with strategic petroleum reserves may take action and release volumes if the disruption of the Strait risks being extended.”
The upheaval in the Middle East poses particular risks for Asian countries, the market for about 80 percent of the petroleum through the Hormuz, according to the International Energy Agency.
But the conflict also poses risks to Europe, a major market for LNG from Qatar.
“The closure has potentially severe implications for Europe’s energy security,” said a note from Eurasia Group that pointed out that European gas markets are “very tight” after a cold winter.
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Petroleum-importing countries within the Organization for Economic Co-operation and Development are required to keep 90 days of emergency crude stockpiles that, in theory, should limit price increases.
