If the Iran war takes oil above US$120 a barrel, how bad could the shock get?

2026.03.19 12:20 Iran launched attacks on Gulf energy sites, including Qatar’s huge Ras Laffan LNG facility (pictured), in retaliation for an Israeli strike on Iran’s South Pars gas field. Photo: AFP With the US-Israel war on Iran entering its third week, the world faces the risk of a more severe oil shock as military strikes expand to major energy infrastructure, heightening fears of a prolonged conflict. In this explainer, the South China Morning Post examines the latest developments and factors driving oil price volatility and assesses the potential impact on the global economy. Energy infrastructure: what is the latest? An Israeli air strike hit energy facilities on Wednesday at Iran’s South Pars natural gas field, the world’s largest, which it shares with Qatar. In retaliation, Tehran struck the world’s largest liquefied natural gas facility in Qatar with a ballistic missile and threatened vital energy infrastructure in Saudi Arabia and the United Arab Emirates. International oil prices surged on the news, with the value of benchmark Brent futures moving between US$113 and US$115 as of press time on Thursday after a previous close of US$107.38. At the same time, the Iran-controlled Strait of Hormuz – a critical waterway for energy flows – is effectively closed. US Vice-President J.D. Vance warned on Wednesday that consumers face a “rough road ahead” as global oil prices soar. “The risk of attacks on key crude oil infrastructure in the Middle East – including oilfields, ports and terminals – has risen significantly, heightening the risk of potential, substantial supply disruptions,” said Wang Shimeng, an analyst with Cinda Futures, in a research note on Thursday. Analysts at Citi Research said in a note on Wednesday that they expected Brent prices to reach between US$110 and US$120 per barrel as the conflict continues in the coming days The price, they said, was likely to continue increasing until one of several developments occurs: the US ends its military oper

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