The international energy markets saw a sharp rise on Thursday because Iran has attacked major energy infrastructure in the Gulf region fuelling concerns of a longer supply crisis. This is reported to have seen the strikes take on a large natural gas plant in Qatar and oil refineries in Kuwait, which had a great impact on production and exports.
The Ras Laffan terminal was one of the most significant strikes as it is an important center that processes a significant volume of liquefied natural gas (LNG) in the world. Qatar is one of the largest LNG exporters in the world, supplying close to a quarter of the world gas needs, which makes the harm all the more effective. This has been worsened by the closing of the Strait of Hormuz which is a key sea passage of a significant percentage of the world oil and gas.
Consequently, the price of Brent crude rose to almost $114 per barrel, which is extremely high compared to the levels before the start of the conflict which was approximately 73. Natural gas prices also shot up sharply with the European benchmark registering a 24 percent increase. The current war has shaken up the stock markets across the world with the stock indices reducing globally as investors respond to the increasing risks of inflation and uncertainty.
In the United States, markets were further strained because they feared that an increase in the energy cost will slow the interest rate reduction. The yields in the treasury increased and the US dollar appreciated against the leading currencies.
Analysts fear that further shocks in the energy industry of the Gulf would result in a long-term volatility of the world oil and gas markets, with far-reaching effects on the global economies.
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