The war’s most immediate global impact is being felt at the fuel pump. Crude oil prices have surged roughly 40% in recent weeks to approximately $120 per barrel, driven by fears over disruptions to shipping through the Strait of Hormuz. European energy giants are warning of “serious turbulences” and potential shortages.
The timing could hardly be worse. Cyclone Narelle simultaneously knocked out significant Australian LNG production, including Chevron’s Wheatstone facility in Western Australia. According to MST Marquee analyst Saul Kavonic, more than a quarter of global LNG supply has now been affected by the combined disruptions. Japan’s Prime Minister Sanae Takaichi has asked the International Energy Agency to consider a fresh release of strategic petroleum reserves, following a coordinated drawdown of 400 million barrels.
The Philippines has declared an energy state of emergency. South Korea is preparing for “worst-case scenarios.” And in India, the government has cut excise duty on petrol and diesel by ₹10 per litre while imposing export levies on diesel and aviation fuel to shore up domestic supplies. In rural Karnataka, small hotel owners have been forced to shut down entirely due to the unavailability of commercial LPG.
