Global energy markets witnessed a sharp spike in prices on Tuesday, March 17, 2026, as Iran escalated the ongoing conflict by successfully targeting vital oil and gas production facilities across the Gulf for the first time. International benchmark Brent crude jumped 3% to $103.28 per barrel, while U.S. West Texas Intermediate (WTI) rose over 3.6% to reach $96.85, reversing a brief decline from the previous session. The surge was triggered by reports of a drone strike on the Shah natural gas field in the United Arab Emirates—one of the world’s largest—which forced a complete suspension of operations. Additionally, attacks were reported at the Majnoon oilfield in Iraq and the Fujairah oil storage terminal, a critical export hub in the Gulf of Oman. These strikes mark a significant tactical shift from targeting shipping vessels to hitting the actual infrastructure that sustains global supply, raising fears that nearly 20 million barrels per day of output could remain “bottled up” as the war enters its third week.
The impact has been equally severe in the natural gas sector, with European wholesale prices climbing 3% to €52 per megawatt hour as the regional energy crisis deepens. The “functional impairment” of the Strait of Hormuz has brought maritime traffic to a near standstill, stalling 20% of the world’s liquefied natural gas (LNG) exports and forcing import-dependent nations in Asia and Europe to scramble for alternative supplies. Analysts at Goldman Sachs and the IEA warned that this represents the largest supply disruption in modern history, with the UAE’s daily crude output reportedly halving since the start of hostilities on February 28. In the United States, the average fuel price has surged toward $3.80 per gallon, prompting President Trump to demand that allies deploy warships to reopen the strait—a request that has so far met with resistance from several European nations.
As the conflict shows no signs of de-escalation, the “geopolitical risk premium” on energy is becoming a lasting structural shock to the world economy. With Saudi Arabia’s largest refineries and Qatari export facilities also under threat from drone swarms, market experts predict that Brent crude could soar toward $130 per barrel if the production halts persist. This surge is not only eroding consumer purchasing power but is also pushing energy-intensive industries, such as steel and chemicals, into “survival mode” across the globe. While the arrival of specific carriers like the Nanda Devi at Indian ports has offered localized relief, the broader global energy landscape remains in a state of high volatility, dictated by the precision and frequency of strikes on the Gulf’s critical infrastructure.