Middle East conflict: Energy security risks and price shocks as market volatility hits supply chains
Since the ignition of the conflict between the U.S. and Israel on one side and Iran on the other, the global markets have been on tenterhooks, as fears continue to grow over the impact the hostilities will have not just on the Middle East region but also the world at large, especially in terms of economy, energy security, and global supply chains, affecting all offshore energy and maritime realms across the globe, albeit to different degrees.
Following the U.S. and Israel’s launch of a military campaign against Iran, the situation in the Middle East escalated further, with Iran’s closure of the Strait of Hormuz, QatarEnergy’s halt of LNG production and associated products at some of its assets, the firm’s declaration of force majeure to its LNG buyers, and Iran’s missile attack on at the Ras Laffan Industrial City. As a result, Qatar’s LNG export capacity was cut by 17%, causing an estimated loss of $20 billion in annual revenue.
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