Oil Prices Spike as US-Israeli War Disrupts Iran Shipping
Donald Trump authorized military strikes against Iran, triggering a global energy crisis and surging fuel prices after the Strait of Hormuz was effectively closed.
A military conflict involving the United States and Israel against Iran, initiated on February 28, 2026, triggered a severe global energy crisis. The campaign, termed Operation Epic Fury, included strikes on Iranian nuclear sites and fuel depots in Tehran and Karaj, resulting in the death of Supreme Leader Ali Khamenei. Iran retaliated with missile and drone attacks on energy infrastructure in Bahrain, Qatar, Saudi Arabia, the UAE, and Kuwait, while effectively blockading the Strait of Hormuz, a waterway handling 20% of global oil consumption.
Donald Trump dismissed the resulting economic turmoil, characterizing surging fuel costs as a "small price to pay" for neutralizing the Iranian nuclear threat. In the U.S., national gasoline averages jumped nearly 50 cents in one week to approximately $3.48 per gallon, while Brent crude peaked near $120 per barrel. Global markets plummeted, with significant losses in Asian and European indices due to fears of stagflation and supply shocks. In response, G7 finance ministers and the International Energy Agency coordinated the release of 400 million barrels of strategic oil reserves, causing prices to plunge by 31% on March 9.
Iran appointed Mojtaba Khamenei as the new supreme leader, signaling a continued hardline posture. While Trump later claimed the war was "pretty much" complete and suggested the U.S. might take over the Strait of Hormuz to ensure transit, the region remains volatile. The U.S. Navy has begun escorting tankers through the strait, and the administration is considering easing Russian oil sanctions to further stabilize global markets.
