FRANKFURT, Germany (AP) — Energy prices rose sharply Monday as disruptions to oil tanker traffic through the Strait of Hormuz chokepoint, as well as Qatar’s announced shutdown of its natural gas production, raised uncertainty about how US and Israeli attacks on Iran would affect supply to the world economy.

US oil traded 7.6 percent higher at $72.12 per barrel, while international standard Brent was up 8.6% at $79.11 per barrel. Natural gas futures in Europe jumped more than 40% after Qatar, a major supplier, halted production due to the conflict.

Higher oil prices raise the prospect of costlier gasoline for US drivers as well as increased prices for other goods at a time when people in many countries have been stung by inflation.

A key focus was the strait at the southern end of the Persian Gulf, through which 20% of the world’s oil supply passes. Tanker traffic dropped sharply amid disruption of satellite navigation systems, data and analytics firm Kpler said on X, while the UK Maritime Trade Operations Centre reported attacks on several vessels in the area on either side of the strait and warned of elevated electronic interference to systems that show where ships are.

A bomb-carrying drone boat struck a Marshall Islands-flagged oil tanker in the Gulf of Oman, killing one mariner, Oman said.

Iran has been threatening vessels approaching the Strait of Hormuz and is believed to have launched multiple attacks.

Saudi authorities reported they intercepted Iranian drones that attacked the Ras Tanura oil refinery near Dammam and the refinery was shut down as a precaution, Saudi state television reported. Market attention has focused on whether the conflict would widen to other oil-producing countries in the region.

For much Mideast oil, there’s no way around the strait

There are pipelines that circumvent the strait, but they don’t have enough capacity to move all the oil that passes through the waterway. Saudi Arabia, Iraq and the United Arab Emirates all depend on tankers to get the bulk of their oil to global markets.

Analysts say completely blocking the strait would hurt Iran too since all of its 1.6 million barrels per day passes through the strait, most of which goes to China, where refineries are less concerned about US sanctions that prevent Iran from selling its oil elsewhere

The strait is also a key route for liquefied natural gas. European futures contract for April delivery shot up to 45.46 euros ($53.26) on the ICE commodities exchange. The jump came after QatarEnergy said Monday it would stop its production of liquefied natural gas as the US-Israeli military campaign on Iran rages. The state-owned firm blamed the war for the decision.

Qatar is a major gas supplier for Europe, which relies on shipments of liquefied gas, or LNG, to replace supplies of Russian pipeline gas lost due to the invasion of Ukraine.

Oil price shock comes as US gas prices were already rising

The price of crude is the single largest factor in how much US motorists pay for fuel at the pump — a highly political issue ahead of midterm Congressional elections. And higher oil prices are usually felt at the pump within a couple of weeks at most.

Gas prices are already rising ahead of the summer driving season as people travel more. The national average for a gallon (conversion) of regular went up by more than 5 cents last week to $2.98, according to motoring club AAA.

Crude price increases are substantially reflected in pump prices in 20 days and a $10 increase typically results in around a 25-cent rise per gallon, according to 2019 research by the Federal Reserve Bank of Dallas.

The price of crude has less impact in Europe, where taxes make up most of the price of fuel. But higher energy costs can affect prices across the economy. A sustained rise of $15 per barrel could add 0.5 percentage points to consumer prices in Europe, according to Holger Schmieding, chief economist at Berenberg Bank.

Temporary price spike?

Monday’s price increase was within the $5-$10 per barrel range expected by analysts based simply on the fear factor associated with the outbreak of war. And some war concerns were already reflected in the price before the conflict started.

However, long-term disruption to ship traffic in the strait could send prices even higher, and so could damage to oil infrastructure in other Gulf countries. Meanwhile, a shorter conflict in which disruptions are easily reversible could mean the current price spike won’t last.

“The key question for the global economy is obvious: Will the Strait of Hormuz be effectively closed for oil and gas exports for more than a few weeks?” Schmieding said. “If so, it would hurt global growth and raise global inflation noticeably. But I would expect Trump to go to great lengths to prevent a lasting surge in energy prices that could hurt him at home ahead of the US midterm elections in November.”

He forecast oil prices would return to $65-$70 per barrel after a near-term spike.

Prices could go higher for longer if the war spreads

Iran’s attack on the Ras Tanura refinery represents a major escalation, a Middle East analyst said, with Iran demonstrating that key Gulf energy infrastructure is within its reach, and investor sentiment likely to worsen.

JUST IN: ???????? Iran strikes Saudi Arabia's Aramco Ras Tanura oil refinery. pic.twitter.com/eTmPGRFAY5 Advertisement if(typeof rgb_remove_toi_dfp_banner != "function" || !rgb_remove_toi_dfp_banner("#336x280_Middle_3")){ window.tude = window.tude || { cmd: [] }; tude.cmd.push(function() { if(navigator.userAgent.indexOf("rgbmedia-app") > -1){ tude.setDeviceType("mobile"); } tude.refreshAdsViaDivMappings([ { divId: '336x280_Middle_3', baseDivId: '336x280_Middle_3', } ]); }); } — BRICS News (@BRICSinfo) March 2, 2026

JUST IN: ???????? Iran strikes Saudi Arabia's Aramco Ras Tanura oil refinery. pic.twitter.com/eTmPGRFAY5

— BRICS News (@BRICSinfo) March 2, 2026

Torbjorn Soltvedt, principal Middle East analyst at risk intelligence company Verisk Maplecroft, said Iran’s goal is to raise the economic costs of the conflict for Gulf states like Saudi Arabia and the United Arab Emirates, hoping that these countries will pressure the US and Israel to de‑escalate.

He said that the coming days and weeks will be marked by uncertainty and volatility in global markets, with oil prices likely to push past $80 per barrel.

“If we start to see additional direct attacks against energy infrastructure, not just in Saudi Arabia and Kuwait, but in other countries in the region, then that’s when the market will start to think about a push toward $90 and perhaps even beyond.”

Times of Israel staff contributed to this report.

Are you relying on The Times of Israel for accurate and timely coverage of the Iran war right now? If so, please join The Times of Israel Community. For as little as $6/month, you will:

Support our independent journalists who are working around the clock under difficult conditions to cover this conflict;

Read ToI with a clear, ads-free experience on our site, apps and emails; and

Gain access to exclusive content shared only with the ToI Community, including weekly letters from founding editor David Horovitz.

We’re really pleased that you’ve read X Times of Israel articles in the past month.

You clearly find our careful reporting of the Iran war valuable, at a time when facts are often distorted and news coverage often lacks context.

Your support is essential to continue our work. We want to continue delivering the professional journalism you value, even as the demands on our newsroom have grown dramatically during this ongoing conflict.

So today, please consider joining our reader support group, The Times of Israel Community. For as little as $6 a month you'll become our partners while enjoying The Times of Israel AD-FREE, as well as accessing exclusive content available only to Times of Israel Community members.

Thank you,David Horovitz, Founding Editor of The Times of Israel

1 Iranian missile warhead falls less than a kilometer from Temple Mount, al-Aqsa Mosque

2 9 victims of Iranian missile strike on Beit Shemesh named, including 3 teen siblings

3 Reporter's notebook‘Everything is gone’: Deadly Iranian strike on Beit Shemesh leaves residents reeling

4 IDF strikes in Beirut after Hezbollah enters fray and fires rockets, drones at north

5 AnalysisWith Operation Epic Fury, Trump relies on Iranian people to finish the job

6 AnalysisDubai’s carefully built image as sun-filled safe haven shattered by Iranian strikes

7 3 US F-15 fighter jets shot down by Kuwait in ‘friendly fire’ incident; crews survive

8 Reporter's notebookIranians and Jews celebrate Khamenei’s death shoulder to shoulder in north London streets

2026 US-Israel war with Iran

© The Times of Israel