Iran War Causing Largest Ever Oil Disruption, I.E.A. Says
Conflict is forcing producers to slash production and close ports as Iran steps up attacks on energy infrastructure.
The war in the Middle East has caused the “the largest supply disruption in the history of the global oil market,” the International Energy Agency said on Thursday, as Iran stepped up its attacks on tankers in the region.
Before the war, 20 million barrels of oil passed daily through the Strait of Hormuz, the narrow waterway off Iran’s southern coast. That amount has plunged to “a trickle,” the I.E.A. said in its monthly report, since Iran warned that ships passing through were at risk of attack.
This week, the 32 member states of the I.E.A. agreed to release 400 million barrels of oil from their strategic reserves, the most ever and the first coordinated release since Russia’s full-scale invasion of Ukraine in 2022.
But the move did not immediately arrest the rise in oil prices. The price of Brent crude, the global benchmark, climbed briefly back above $100 a barrel on Thursday, about $30 higher than it was at the end of February, before the U.S.-Israeli military assault on Iran. The supply disruptions caused by the war showed little sign of abating with tankers in the Persian Gulf on fire after coming under attack and Iraq closing its oil port terminals.
As Gulf countries struggle to export their oil, they have curtailed production by at least 10 million barrels a day, as oil storage fill up. Exports of other refined products and liquefied petroleum gas is also effectively at a standstill, the I.E.A. said.
The widespread cancellations of flights in the Middle East caused by closed airspaces and disruptions to liquefied petroleum gas supplies are expected to curb global oil demand by one million barrels a day in March and April, the agency added.
The effect of the supply disruptions has been rippling around the globe. Some countries have taken measures to control fuel demand and shield customers from high costs. Pakistan has closed schools and ordered government offices to operate four days a week and South Korea said this week that it would cap prices at the pump for the first time in nearly 30 years. In France, TotalEnergies, one of the country’s biggest energy companies, said on Thursday that it would cap prices for gas and diesel until the end of the month.
On Wednesday, Ursula von der Leyen, the president of the European Commission, said households and companies needed relief from high energy costs. The commission was even “exploring subsidies or capping the gas price,” she said, while urging countries to lower taxes on electricity.
Eshe Nelson is a Times reporter based in London, covering economics and business news.
More on the Fighting in the Middle East
Heavy Bombing in Iran: Iranians cowered under a recent barrage, which some residents described as among the worst they had experienced since the war started, as Pete Hegseth, the U.S. defense secretary, said the U.S. aimed to wipe out Iran’s capacity to obtain nuclear weapons “forever.” Iranian detention centers, some holding people swept up in a government crackdown on protests along with other prisoners, have been damaged in the U.S.-Israeli airstrikes.
Damaged U.S. Sites: Iran has responded to the U.S.-Israeli assault on the country by launching drones and missiles at American targets across the Middle East. The New York Times has identified at least 17 damaged U.S. sites and other installations, several of which have been struck more than once since the war began.
When Will the War End?: Eleven days into an expanding military campaign, President Trump and his officials have given conflicting indications on how long the United States intends the war to last. The Iranian military is adjusting its tactics, senior U.S. defense officials said, even as the Trump administration insists that the United States is winning the war.
Food Shortages: Some residents of Lebanon, Gaza and Iran are reporting shortages of food, rising food prices and other disruptions to food supplies as the conflict in the Middle East continues.
Toll on American Service Members: Eight Americans have been seriously wounded, military officials said, but the bulk of the injured have already returned to duty. Seven Americans have been killed and 140 U.S. service members have been injured overall, the Pentagon said.
Strait of Hormuz: At least three ships were hit in and around the vital oil route, according to a British maritime monitoring group, as the Middle East war chokes off one of the key conduits for the global oil trade.
Iranian Soccer Squad: Seven members of the Iranian women’s soccer delegation had initially opted to stay in Australia. The reversal by one of them was a sign of how fraught that decision was. Members of the Iranian soccer team who chose to remain in Australia are far from the first to travel to a competition and stay there.
4 Continents in 62 Hours: When conflict broke out in the Middle East, thousands of travelers were stranded. We followed a New Orleans doctor on his epic journey to get home.