Iran: Energy

Domestic

Following military strikes on its oil infrastructure by Israel and the U.S., Iran's IRGC attacked commercial ships in the Strait of Hormuz and near Iraq, disrupting a key global oil shipping route. The Revolutionary Guard claimed responsibility for hitting several oil tankers and stated it controlled the strait. These actions, alongside a strike on Saudi Arabia's Ras Tanura oil refinery, pushed global oil prices above $100 per barrel. The Strait of Hormuz remains open for Iranian oil heading to China but is largely closed to other traffic, creating uncertainty over Iran's intentions regarding the closure of the vital lane.

International

The conflict caused the largest disruption to oil supplies in history, leading to a major international response. The U.S. authorized a 30-day waiver for purchases of Russian oil and plans for the U.S. Navy to escort tankers through the Strait of Hormuz. Kuwait cut production while OPEC+ agreed to increase output. QatarEnergy stopped production at its LNG facilities, declaring force majeure and causing global natural gas prices to surge. The G7 nations are preparing to release oil reserves and also considering escorting ships. Global oil prices fluctuated sharply, influenced by the attacks and conflicting statements from Trump about the conflict's duration.