Joshua Kurlantzick
The Iran war has clearly upended energy markets around the world. Oil futures closed at $95 yesterday, even as some countries have released reserves in an attempt to prevent the oil price from going even higher. As Agence France Presse (AFP) has reported, strikes on the massive Ras Tanura refinery in Saudi Arabia, Ras Laffan gas processing base in Qatar, and the complex housing the Ruwais refinery in the United Arab Emirates, combined with Iran’s blockage of the Strait of Hormuz, has resulted in a drop of Gulf countries’ oil production by 10 million barrels per day, as compared to March 2025. AFP further reported that the amount of oil passing through the Strait of Hormuz has fallen to less than 10 percent of pre-war levels.
The impact can be felt everywhere, but in Asia – where nearly every country is highly dependent on Middle Eastern oil – the war has caused outright energy panic, with governments scrambling to respond and having few short-term answers. After all, Asia is the most exposed to the effects of the war on oil prices, since it is the region that relies most heavily on oil and gas shipped through the Strait of Hormuz. The level of consumer panic, in particular, is so great in some Asian states that it could soon lead to not only major economic shocks but even violence over limited energy supplies.
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