According to the FT, al-Kaabi said a prolonged war in the region could force Gulf energy exporters to shut down production within weeks. He added that even if hostilities stopped immediately, it could take “weeks to months” for Qatar to restore normal delivery cycles after an Iranian drone strike on the country’s largest liquefied natural gas facility.
The warning comes as the conflict involving the US, Israel and Iran threatens to choke off supply routes critical to global energy trade. Oil markets are increasingly focused on the risk of disruptions around the Strait of Hormuz, a narrow shipping corridor through which roughly one-fifth of the world’s crude and a significant share of global liquefied natural gas passes.
Brokerages have also begun outlining worst-case scenarios if the waterway remains blocked for a prolonged period. Analysts at DBS Bank said crude oil prices could climb to $100-150 per barrel in an extreme scenario involving a full disruption of shipments through the Strait of Hormuz.
Brent crude has already begun reacting to the geopolitical risk. Prices rose sharply this week, climbing as much as to around $85 a barrel, the highest level since early 2025.
The escalation in the region has already begun affecting production. Iraq, the second-largest producer in the OPEC group, has reportedly cut output significantly as export routes remain under threat. Tanker traffic through the Strait of Hormuz has also been disrupted amid attacks on vessels.
Analysts say the impact of any prolonged disruption would extend well beyond energy markets. A sustained surge in oil prices would likely raise inflation across emerging economies and slow economic growth.Goldman Sachs estimates that a supply-driven increase in Brent prices from $70 to $85 per barrel could raise inflation across emerging Asia by about 0.7 percentage points while reducing economic growth by roughly half a percentage point. Larger increases could trigger broader economic stress.
Higher oil prices typically widen current account deficits for oil-importing economies. Analysts at ING note that even a 10% rise in oil prices can worsen external balances in emerging markets by 40–60 basis points, putting pressure on currencies and capital flows.
India would be particularly vulnerable to a prolonged supply disruption. The country imports the majority of its crude oil requirements, and about half of those imports pass through the Strait of Hormuz. Roughly 2.6 million barrels per day of India’s oil flows through the corridor.
For equity markets, a spike toward $150 oil would likely trigger a broad risk-off reaction. Higher energy costs raise input prices for companies, compress corporate margins and weaken consumer spending.
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Historically, sectors such as aviation, paints, chemicals and logistics tend to face the most pressure when oil prices surge sharply. At the same time, upstream oil producers and energy companies typically benefit from higher crude prices.
The broader stock market impact would also depend on the duration of the shock. Short-term price spikes triggered by geopolitical tensions often reverse if supply routes reopen quickly. However, a sustained disruption to Gulf exports could push global markets into a period of higher inflation, weaker growth and increased volatility.
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The scale of the risk stems from the concentration of the global oil supply in the region. Nearly all crude exports from Kuwait, Qatar and Bahrain move through the Strait of Hormuz, while a large portion of shipments from Iraq, Iran, the UAE and Saudi Arabia also pass through the channel after using alternative pipelines.
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