Oil prices soar; Iran’s attacks on Gulf states condemned by UN; US responsible for Iranian girls school strike; Israel attack Hezbollah in Israel

The Iran war is causing unprecedented turmoil in oil markets, hitting 7.5 per cent of global supply and an even bigger swath of exports, the International Energy Agency said.

“The war in the Middle East is creating the largest supply disruption in the history of the global oil market,” the IEA said in its monthly report on Thursday. The previous day, its members agreed to release an unprecedented 400 million barrels from emergency reserves to counteract the chaos.

The most immediate impact of the war on energy markets is the closure of the Strait of Hormuz, choking off oil and gas flows through the trade artery. With Gulf producer giants forced to cut output because they can’t export from the region, the conflict is eroding a global oil supply glut. It also means the effects will be felt well beyond when the waterway is reopened.

The IEA estimates that the war will slash global oil supply by 8 million barrels a day this month, or almost 250 million barrels in total. Flows through the strait, through which 20 million barrels of crude and products passed last year, are down by more than 90%, the IEA estimates.

Bloomberg