reserves

Iran’s paralysis of the Strait of Hormuz has led to major disruption in global oil and gas supply and many countries have begun tapping into their strategic oil reserves to evade an economic crisis.

Since the US-Israeli war on Iran began on February 28, Tehran, whose territorial waters extend into the Strait, has blocked the passage of vessels carrying 20 percent of the world’s oil and liquified natural gas (LNG) from the Gulf to the rest of the world. The strait is the only waterway to open ocean available for Gulf oil and gas producers.

Last week, the price of Brent crude topped $100 a barrel compared to the pre-war price of around $65.

The United States Trump administration has tried and failed to re-open the strait. First, it called on Western nations to send warships to help escort shipping through the strait – an option all have declined or failed to respond to. Then, on Sunday, Trump gave Iran 48 hours to reopen the strait or face US attacks on its power plants.

However, on Sunday, Iran said it would hit back at power plants in Israel and those in the region supplying electricity to US military assets. And, on Monday, Iran said it would completely shut the Strait of Hormuz if US attacks on its energy infrastructure continue.

Following Iranian attacks on energy infrastructure across the Gulf over the past three weeks, countries including Saudi Arabia, UAE, Iraq and Kuwait have also cut their oil output, raising further concerns about global oil and gas supply.

On Monday, Trump appeared to backtrack on his Hormuz ultimatum when he ordered all US strikes on power plants in Iran to be paused for five days and claimed the US was holding talks with Iran. Iran has denied this.

In the face of chaos, on March 11, the 32 member countries of the International Energy Agency (IEA) agreed to release 400 million barrels of oil from their strategic emergency reserves – the largest stock draw in the agency’s history. It is far higher than the 2022 release of 182 million barrels of oil by the group’s members after Russia invaded Ukraine.

What are strategic oil reserves and which countries hold them?

What is a strategic oil reserve?

A strategic oil reserve or strategic petroleum reserve (SPR) is an emergency stockpile of crude oil which is held by the government of a country in government facilities.

This oil reserve can be drawn on in cases of emergencies like wars and economic crises. Governments generally buy the oil through agreements with private companies in order to keep their reserves filled.

According to the IEA, its members currently hold more than 1.2 billion barrels of these public emergency oil stocks with a further 600 million barrels of industry stocks held by private organisations but under government mandate to be available to supplement public needs.

Other reserves are also held by non IEA members like China.

Which countries have strategic oil reserves? Can they withstand the war in Iran?

China

Beijing is not an IEA member, but holds the world’s largest strategic oil reserve.

According to China’s Ministry of Ecology and Environment, Beijing “started a state strategic oil reserve base programme in 2004 as a way to offset oil supply risks and reduce the impact of fluctuating energy prices worldwide on China’s domestic market for refined oil”.

“The bases are designed to maintain strategic oil reserves of an equivalent to 30 days of imports, or about 10 million tonnes,” according to a 2007 report from Chinese state news agency Xinhua.

These strategic oil reserves are primarily located along China’s eastern and southern coastal regions such as Shandong, Zhejiang and Hainan.

China does not officially publish information about its crude inventories so it is not clear how much oil the country has in reserve. However, according to energy analytics firm Vortexa, in 2025, “China’s onshore crude inventories (excluding underground storage) continued to rise… reaching a record 1.13 billion barrels by year-end”.

According to data from Kpler, China bought more than 80 percent of Iran’s shipped oil in 2025. As the war in Iran escalates, therefore, Chinese companies such as refiner Sinopec have begun pushing for permission to use oil from the country’s reserves according to a Reuters report on Monday.

“We basically won’t buy Iranian oil, this is pretty clear,” Sinopec President Zhao Dong told a company results briefing in March, according to Reuters.

“We believe the government is closely monitoring crude oil and refined fuel inventories and market situations, and will advance policies at the appropriate ⁠time to support refinery productions,” he added.

US

Of the IEA members, the US holds one of the largest strategic oil reserves with 415 million barrels of oil. The stores are maintained by the US Department of Energy. It has confirmed that it will release 172 million barrels of oil from its SPR over this year as its contribution to coordinated efforts with the IEA.

On Friday, the Trump’s administration announced that it has already lent 45.2 million barrels of crude from the SPR to oil companies.

The US created its SPR in 1975 after an Arab oil embargo triggered a spike in gasoline prices which badly affected the US economy.

The reserves are located near big US refining or petrochemical centres, and as much as 4.4 million barrels of oil can be shipped globally per day.

The SPR currently covers roughly 200 days of net crude imports, according to a Reuters news agency calculation.

US presidents have tapped into the stockpile to calm oil markets during war or when hurricanes have hit oil infrastructure along the US Gulf of Mexico.

In March 2024, US President Joe Biden announced oil would be released from the reserve to ease pressure from oil price spikes following Russia’s invasion of Ukraine in February 2022 and amid subsequent sanctions imposed on Russian oil by the US and its allies.

Japan

An IEA member, Japan also has one of the world’s largest strategic oil reserves.

According to Japanese media Nikkei Asia, at the end of 2025, the country held about 470 million barrels of in emergency reserves which is enough to meet 254 days of domestic consumption. Out of this amount, 146 days worth of oil are government-owned, 101 days are owned by the private sector, and the remainder is jointly stored by oil-producing countries.

Japan set up its national oil reserve system in 1978 to prevent future economic disruptions following the global oil crisis in 1973. That oil crisis heightened Japan’s vulnerability and dependence on oil from abroad. The country remains one of the world’s largest oil importers, relying on fossil fuels from overseas for about 80 percent of its energy needs.

Japan’s reserves are primarily located in 10 coastal national stockholding bases with major storage sites in the Shibushi base in Kagoshima in southern Japan.

On March 16, Japan announced that it had begun releasing oil from its emergency reserves amid the global energy crisis sparked by the effective closure of the Strait of Hormuz.

Japanese Prime Minister Sanae Takaichi told journalists the country would unilaterally release 80 million barrels of oil from stockpiles amid supply concerns.

UK

As of February 26, according to the UK Department of Energy Security and Net Zero, the UK holds about 38 million ⁠barrels of crude oil and 30 million barrels of refined products, as strategic reserves. The reserves are thought to be able to last around 90 days.

The country established its reserves in 1974 following the oil crisis of the 1970s and also to meet its IEA obligations. Members of the organisation are required to maintain at least 90 days of net imports in reserve.

The UK’s strategic reserves are largely held by private oil companies, but are regulated by the government. Milford Haven in South Wales and Humber in northeast England are key locations of reserves.

The country is among the 32 IEA nations releasing oil from its reserve to address the oil crisis amid the war in Iran. The UK government will be contributing 13.5 million barrels as a part of the release.

EU

EU member nations including Germany, France, Spain and Italy, all IEA members, also hold strategic oil reserves.

Germany has 110 million barrels of crude oil and 67 million barrels of finished petroleum products which are held by the government and can be released in a matter of days, according to Germany’s economy ministry.

France reported about 120 million barrels’ worth of crude and finished products in reserve at the end of 2024, the most recent data publicly available. About 97 million barrels of that is held by SAGESS, a government-mandated entity, with ‌a breakdown ⁠of about 30 percent crude oil, 50 percent gasoil, 9 percent gasoline, 7.8 percent jet fuel and some heating oil. Another 39 million barrels are held by the country’s oil operators.

On March 16, Spain approved the release of around 11.5 million barrels of oil reserves over 90 days to counter ⁠supply shortages caused by the effective closure of the Strait of Hormuz, Energy Minister Sara Aagesen told reporters. This is the country’s contribution to the IEA release. The country has around 150 million barrels of crude oil reserves in total.

Italy, by law, was holding about 76 million barrels of reserves, representing 90 days of Italy’s average net oil imports, in 2024.

Winning tip: Whitebeams and roe deer in Bristol

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Dartmoor’s way of the dead

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A cemetery now full of life in London’s East End

Tower Hamlets Cemetery Park is a truly magical place. Not your typical local nature reserve, and not your typical Victorian-era cemetery, this now deconsecrated space is truly a haven for human and non-human visitors. The site attracts an impressive array of flora and fauna thanks to its carefully “managed wildness”– an essential respite in London’s East End. Wander at your own pace or join the Friends (the charity which has carefully defended and managed the space since the 1990s) for a tour covering topics ranging from foraging and fungi to women’s history and grave symbolism.
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Coastal birding and a castle in Dumfries

The Dumfries and Galloway coast is a beautiful but often overlooked gem among Scotland’s natural offerings. Caerlaverock national nature reserve on the Solway Firth is a highlight, with its protected wetlands serving as a seasonal home for thousands of migrating birds, including geese, plovers and waders. It lends the place a year-round charm, even in the cold winter months. And if birdwatching isn’t your thing, you can still enjoy the excellent walks and cycle paths, stunning views and a rare sense of peace. Make sure to check out the nearby Caerlaverock Castle (from £6.50 adults, £3.90 children), with its picturesque setting – and unique triangle shape!
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Historic sailing on the Norfolk Broads

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London’s hidden wetlands

Not many Londoners know that there is a real treasure of a nature reserve just 20 minutes from the city centre by tube. The Walthamstow Wetlands is a protected area, easily reached via Tottenham Hale railway/tube station. I often spend a day there with a picnic, a bird guidebook, a flask of coffee and a pair of binoculars. Birds come to the site to feed around the 10 areas of open water and marshland. Swifts and little ringed plovers arrive in spring. Much-travelled black-tailed godwits can also be seen and there’s even the chance of spotting a peregrine falcon. Enjoy the circular bird walk, viewing platforms and hiding areas. There are also weekly guided bird walks starting from the tube station from early spring. It’s free to enter and wander around the nature reserve. Trees and wild fauna abound everywhere you go – a brilliant oxygen overload after the traffic fumes of central London.
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Hampshire’s alluring lagoons

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Lakeside magic in Eryri (Snowdonia)

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On safari in Kent

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Brent futures rose sharply on Thursday, spiking above $100 before easing slightly but remaining higher than levels seen earlier in the week as markets stay incredibly volatile.

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This comes despite an unprecedented decision by the 32-member International Energy Agency (IEA) on Wednesday to release a record 400 million barrels to calm markets, more than double the volume released after Russia’s 2022 invasion of Ukraine.

Following the IEA decision, Iran stepped up its offensive campaign and launched strikes on Omani oil storage facilities at the Salalah port and multiple ships in and near the Strait of Hormuz, sending prices higher again.

Record coordinated release of reserves

The US alone is contributing 172 million barrels. Germany, France and Italy also confirmed they would tap their stocks, while Japan said it would begin releases next Monday.

IEA executive director Fatih Birol described the current Iran-related crisis as an “oil market challenge unprecedented in scale”, adding that the collective response reflected “strong solidarity” in defence of global energy security.

Exports of crude and refined products from the region have dropped to 10-15% of pre-war levels, with the Strait of Hormuz, which normally carries one-fifth of the world’s oil, effectively closed to the large majority of tankers.

Iran’s attacks blunt expected price relief

The new Iranian strikes came at lightning speed, directly after the IEA announcement.

Drones targeted fuel storage tanks and silos at Oman’s Salalah port, igniting fires that Omani authorities were still working to contain late on Wednesday.

British maritime security firm Ambrey confirmed damage to the facilities, while Danish shipping giant Maersk temporarily halted port operations.

Omani officials stressed there had been “no disruption to the continuity of oil supplies or petroleum derivatives” inside the country itself, while Iranian state media reported that President Pezeshkian had assured Oman’s sultan the incident would be investigated.

At the same time, six vessels were struck in the Gulf and Strait of Hormuz.

Among the reports, there was confirmation of a projectile hitting a container ship near the UAE and strikes on two tankers in Iraqi waters.

UK Maritime Trade Operations, and other monitoring groups, attributed the incidents to Iranian forces or proxies.

These developments, occurring the very day of the reserves release, appear to have smothered the anticipated calming effect on prices.

As of Thursday, the number of ships struck in the region since the beginning of the conflict rose to at least sixteen.

Record release may signal deeper market concerns

Some analysts note that the sheer volume of the release could itself be interpreted negatively. Previous coordinated actions never exceeded 183 million barrels.

The scale of the release suggests importing nations already view the disruption as the most severe and long-lasting in decades.

Even worse, a record release may not be enough.

Speaking to Euronews, Warren Patterson, Head of Commodities Strategy at ING, was blunt in his assessment.

“A record 400 million barrel release from emergency reserves is helpful, but it’s not going to go very far to offset the roughly 15 million daily supply currently disrupted.”

Patterson also added that “the only solution that will bring oil prices down on a sustained basis is getting oil flowing through the Strait of Hormuz again.”

Oxford Economics echoes this concern, warning that “the economic effect of higher energy costs rises as the oil price increases,” in a report that seemingly indicates the crisis is far from over and we have yet to feel the compounding effect of the initial shock.

Russian sanctions relief remains off the table

With the reserve release failing to calm prices, attention has turned to Russian oil as a potential source of additional supply.

The US Treasury last week granted Indian refiners a 30-day waiver to purchase Russian crude from vessels already stranded at sea, though the measure expires on 4 April and deliberately excludes new shipments.

Following the G7 emergency discussions on Wednesday, French President Emmanuel Macron stated that the group had agreed “the situation does not justify lifting any sanctions” on Russia, emphasising the need to increase global production instead.

The contrast between Washington’s narrow waiver and the G7’s firm collective position leaves little prospect of sanctions relief acting as a meaningful pressure valve, a view shared by analysts.

“Any sanction relief for Russia would see some marginal supply increases, but again not enough, with Russia’s oil output having held up well in recent years despite sanctions,” Warren Patterson of ING told Euronews.

$140-$150 oil barrel possible if conflict is prolonged

Should tensions persist, analysts warn prices could climb substantially higher.

Oxford Economics identifies $140 per barrel as the threshold at which the global economy tips into mild recession, reducing world GDP by 0.7% by year-end and pushing the UK, the Eurozone and Japan into contraction.

The managing director of the IMF, Kristalina Georgieva, also stated that every 10% increase in oil prices, provided they persist for most of the year, will push up global inflation by 0.4% and reduce worldwide economic output by as much as 0.2%.

“The risk is stark,” Patterson warned. “It’s only a matter of time before we see oil prices hitting fresh record highs if the conflict is not swiftly and decisively resolved.”

The IEA’s intervention has provided a temporary buffer, but with little visible impact on prices.

Attacks on multiple commercial ships in the waters around Iran on Wednesday increased global energy concerns, pushed nations to unleash strategic oil reserves and sparked fresh critiques of the Trump administration’s readiness for a war it started.

As Trump administration and U.S. military officials continued to claim increasing success and advantage in the conflict — and authorities downplayed a reported threat of drone attacks on California — leaders around the world scrambled to respond to the latest attacks and the International Energy Agency’s call for the largest ever release of strategic oil reserves by its members to help stem energy price spikes.

President Trump also faced renewed questions about a deadly strike on an Iranian elementary school at the start of the war, after the New York Times reported Wednesday that a military investigation had determined the U.S. was responsible.

“I don’t know about it,” Trump said when asked about the report.

In an address Wednesday morning, IEA Executive Director Fatih Birol said energy shipments through the Strait of Hormuz had “all but stopped” amid the conflict, driving massive global competition for oil and gas in wealthier countries and fuel rationing in poorer nations.

He said the IEA’s 32 member nations have brought a “sense of urgency and solidarity” to recent discussions on the matter, and had unanimously agreed to “launch the largest ever release of emergency oil stocks in our agency’s history,” making 400 million barrels of oil available.

However, he said the most needed change is the “resumption of traffic through the Strait of Hormuz.”

A vendor pumps petrol from Iranian fuel oil tankers for resale near the Bashmakh border crossing between Iraq and Iran.

(Ozan Kose / AFP/Getty Images)

Several countries, including Germany, Austria and Japan, had already confirmed their plans to release reserves.

The White House did not immediately respond to a request for comment on any U.S. plans to release its strategic reserves, or how much would be released. The U.S. is an IEA member.

Trump told reporters Wednesday that the U.S. has hit Iran “harder than virtually any country in history has been hit,” including by wiping out its naval fleet and eliminating other vessels capable of laying mines, and that he believes oil companies should resume shipments through the strait despite the recent attacks.

U.S. Interior Secretary Doug Burgum backed the idea of releasing oil reserves in a Fox News interview.

“Certainly these are the kinds of moments that these reserves are used for, because what we have here is not a shortage of energy in the world; we’ve got a transit problem, which is temporary,” Burgum said. “When you have a temporary transit problem that we’re resolving militarily and diplomatically — which we can resolve and will resolve — this is the perfect time to think about releasing some of those, to take some pressure off of the global price.”

Burgum said that while Iran is “holding the entire world hostage economically by threatening to close the strait,” Trump has made the consequences of such actions “very clear,” and “there’s a lot of options between ourselves and our allies in the region, including our Arab friends in the region, to make sure that those straits keep open and that energy keeps flowing for the global economy.”

The IEA did not provide details as to the release of the 400 million barrels, part of a broader reserve of some 1.2 billion barrels held by its members. It said the reserves “will be made available to the market over a time frame that is appropriate to the national circumstances of each Member country and will be supplemented by additional emergency measures by some countries.”

The agency said an average of 20 million barrels of crude oil and oil products transited the strait per day in 2025, and that options for bypassing the strait are “limited.”

While some tankers believed linked to Iran were still getting through the Strait of Hormuz, which under normal circumstances carries about 20% of the world’s oil and natural gas, Iranian officials threatened attacks on other vessels — saying they would not allow “even a single liter of oil” tied to the U.S., Israel or their allies through the channel, which connects to the Persian Gulf.

Trump has repeatedly claimed that the U.S. and its powerful Navy would support commercial vessels and ensure the strait remains open to oil shipments, but that has not been the case.

Tankers wait off the Mediterranean coast of southern France on Wednesday.

(Thibaud Moritz / AFP/Getty Images)

The United Kingdom Maritime Trade Operations center, run by the British military, reported at least three ships struck in the region Wednesday — including ships off the United Arab Emirates and a cargo ship that was struck by a projectile in the strait just north of Oman, setting it ablaze.

The Trump administration and the U.S. military, meanwhile, have been pushing out messaging about wiping out Iran’s ability to plant mines in the strait — posting dramatic videos of major strikes on tiny boats on small docks.

Adm. Brad Cooper, the leader of U.S. Central Command, said in a video posted to X on Wednesday morning that “in short, U.S. forces continue delivering devastating combat power against the Iranian regime.”

“I’ve said this before, but it bears repeating: U.S. combat power is building, Iranian combat power is declining,” he said.

The U.S. has struck more than 60 Iranian ships, and just “took out the last of four Soleimani-class warships,” he said. “That’s an entire class of Iranian ships now out of the fight.”

Cooper said Iranian ballistic missile and drone attacks have “dropped drastically” since the start of the war, though “it’s worth pointing out that Iranian forces continue to target innocent civilians in gulf countries, while hiding behind their own people as they launch attacks from highly populated cities in Iran.”

He also addressed the attacks on commercial shipping in the region directly, saying that “for years, the Iranian regime has threatened commercial shipping and U.S. forces in international waters,” and that the U.S. military’s “mission is to end their ability to project power and harass shipping in the Strait of Hormuz.”

Other U.S. leaders called the U.S. war plan — and specifically its approach to protecting the Strait of Hormuz — into question.

In a series of posts to X late Tuesday, which he said followed a two-hour classified briefing on the war, Sen. Chris Murphy (D-Conn.) slammed the administration’s plans as “incoherent and incomplete.”

Murphy wrote that the administration’s goals for the war seemed to be focused primarily on “destroying lots of missiles and boats and drone factories,” and without a clear plan for what to do when Iran — still led by “a hardline regime” — begins rebuilding that infrastructure, other than to continue bombing them. “Which is, of course, endless war,” he wrote.

Murphy also specifically criticized the administration’s plan for the Strait of Hormuz — which he said simply doesn’t exist.

“And on the Strait of Hormuz, they had NO PLAN,” he wrote. “I can’t go into more detail about how Iran gums up the Strait, but suffice it [to] say, right now, they don’t know how to get it safely back open. Which is unforgiveable, because this part of the disaster was 100% foreseeable.”

Ships in the strait remained under threat of various forms of attack Wednesday, as did much of the region as the war raged on.

There was an attack on a U.S. Embassy operations center at Baghdad’s airport, which officials attributed to a drone launched by Iranian proxies based in Iraq. No casualties were reported.

Lebanon’s Health Ministry reported the death toll there — from fighting between Israel and Iranian-backed Hezbollah fighters — had risen to 634 since last week, including 91 children. Another 1,500 people had been wounded, the ministry said.

Iranian authorities have said U.S. and Israeli attacks have killed 1,255 people since Feb. 28. That includes many Iranian leaders, including then-Supreme Leader Ayatollah Ali Khamenei. U.S. officials have said Iranian attacks in the region have killed seven U.S. service members, with another 140 wounded.

CBS News reported Wednesday that dozens of those injuries were sustained by service members in the March 1 Iranian drone attack on a tactical operations center in Kuwait — which is also where six of the seven deaths occurred.

The outlet reported that the attack was more severe than the Trump administration has revealed, with more than 30 military members still in hospitals Tuesday with a range of battle injuries including “brain trauma, shrapnel wounds and burns.”

Threats extended beyond the Middle East, too — including to California, where law enforcement agencies were warned by federal authorities that Iran “allegedly aspired to conduct a surprise attack” on California using drones launched from a vessel off the U.S. coast.

However, sources told The Times that advisory was cautionary and not backed by credible intelligence.

Times staff writer Gavin J. Quinton, in Washington, D.C., contributed to this report.

International Energy Agency chief says talks aim to assess conditions as US-Israel war on Iran fuels global uncertainty.

The International Energy Agency (IEA) is set to hold an emergency meeting to assess the situation in the Middle East as the US-Israeli war on Iran continues to roil global energy markets.

Fatih Birol, the agency’s executive director, said representatives of IEA member states would meet on Tuesday to assess “the current security of supply and market conditions” amid the conflict.

“I have convened an extraordinary meeting of IEA member governments, which will take place later today to assess the current security of supply and market conditions to inform a subsequent decision on whether to make emergency stocks of IEA countries available to the market,” Birol said.

This week, oil prices hit their highest levels since mid‑2022 amid concerns of prolonged shipping disruptions linked to the war and reduced output from some key producers in countries that have been targeted by retaliatory Iranian strikes.

While the market reversed late in the day on Monday, with benchmarks falling below $90 a barrel, uncertainty persists around how long the United States-Israel war will drag on.

The Strait of Hormuz, a critical Gulf waterway through which about one-fifth of the world’s oil supplies passes, has effectively been shut down as a result of the war.

“If this drags on, it is not just going to be energy prices” that are affected, Al Jazeera’s Osama Bin Javaid explained. “It is going to have an impact on global economies.”

Bin Javaid noted that the extraordinary IEA meeting comes after Group of Seven (G7) countries met to discuss possible actions to help stabilise global energy markets.

European governments have been on edge about the prospect of a repeat of the energy crisis they faced in 2022, when prices surged to record peaks after Russia’s full-scale invasion of Ukraine.

“The IEA will ⁠be presenting an ⁠in-depth analysis of the pros and ⁠cons of releasing stocks ⁠now,” the European Union’s Energy Commissioner ‌Dan Jorgensen said before the agency’s meeting.

Earlier on Tuesday, G7 energy ministers stopped short of deciding on the release of strategic oil reserves in a call, instead asking the IEA to assess the situation before acting.

“Everyone is willing to take measures to stabilise the market, including the United States,” French Finance Minister Roland Lescure told reporters after the latest talks.

“We have asked the IEA to elaborate scenarios for a potential oil stock release; we need to be ready to act at any moment,” he added.

EU leaders also will discuss competitiveness, including energy prices, on a call later in the day with German Chancellor Friedrich Merz, Italian Prime Minister Giorgia Meloni, Belgian Prime Minister Bart De Wever, and others.

EU economy and finance ministers are gathering in Brussels on Monday and Tuesday to discuss how to respond to surging energy prices and anticipated inflation amid the ongoing strikes and counter-strikes in the Middle East.

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“We are ready to take necessary and coordinated steps in order to stabilise markets, such as strategic stockpiling,” French Economy Minister Roland Lescure told journalists on Monday after chairing a meeting of G7 finance ministers.

Asked whether G7 finance ministers had agreed on releasing the system’s strategic stockpile, Lescure said: “We are not there yet.”

“What we’ve agreed upon is to use any necessary tools to stabilise the market, including the potential release of necessary stockpiles. The work is going to keep being done in the next couple of days”, the French minister said.

German Vice-Chancellor Lars Klingbeil said on Monday that his country is open to unlocking the oil reserve, but that “this is not the right time”.

The International Energy Agency’s member countries currently hold over 1.2 billion barrels of public emergency oil stocks, with a further 600 million barrels of industry stocks held under government obligation.

Oil prices have rocketed since the Israeli and US attacks on Iran on 28 February, which killed some 40 Iranian leaders, including the country’s supreme leader, Ayatollah Ali Khamenei. The conflict has now expanded into other countries in the region, including Lebanon and Gulf countries, with retaliatory attacks by Iran hitting civilian energy facilities and US bases.

Mojtaba Khamenei, the former Ayatollah’s son, was elected as successor on Monday, providing continuity in leadership for the current regime.

The price for a barrel of Brent crude, the international benchmark, surged to $119.50 early on Monday, but later traded around $107.80 after the Financial Times indicated that the use of reserve oil to respond to the crisis was on the table.

Leading European stock market indexes started the week with a big sell-off, following a major drop across Asian markets and surging oil prices.

The war is showing no sign of de-escalation. On 4 March, Qatar announced the suspension of its LNG production; then, over the weekend, Israel struck Iranian energy infrastructure while passage through the critical Strait of Hormuz remained suspended.

Energy prices in Europe will be affected, and inflation is likely to rise in the coming months. However, some EU diplomats and the European Commission indicates that the current situation presents significant differences from the energy crisis Europe experienced when the war in Ukraine started in February 2022.

“Thanks to the decisive actions we have taken over the past years, Europe’s energy system is better prepared and way more resilient today. Our energy sources are more diverse and cleaner. Our coordination is stronger,” European Commissioner for Energy Dan Jorgensen wrote on X on 6 March.

He called on the bloc to double down on the energy transition and continue to expand clean and homegrown renewable energy and energy efficiency efficients, all while modernising Europe’s energy infrastructure.

Spanish Economy Minister Carlos Cuerpo told journalists on Monday that the EU should take inspiration from the response to the 2022 crisis as it formulates its response to the war.

A different crisis?

This crisis is also structurally different from the one that exploded in 2022, an EU government official told Euronews.

When Russia’s full-scale invasion of Ukraine began, Europe needed an “infrastructure reset” with a new portfolio of suppliers, the official said – whereas in the current case, “the release of reserves and re-opening of routes could see prices going down faster”.

However, the situation remains extremely volatile, as it is highly dependent on when the Strait of Hormuz will reopen and when production will resume in top LNG-exporting countries.

Discussions on Monday and Tuesday among EU ministers are expected to touch upon energy prices with the European Commission, while euro-area ministers are set to discuss with the European Central Bank how the war could impact inflation and the overall macroeconomic outlook.

While EU ministers are not expecting to put forward a common strategy on the table by the end of the meetings, the EU institutions will present an update of the situation. Most of the member states will likely present their remarks based on their national assessment of the war’s impact, an EU diplomat told Euronews.

Maria Tadeo contributed reporting.

Published on 09/03/2026 – 17:06 GMT+1•Updated
17:14

G7 finance ministers discussed a coordinated release of emergency oil reserves on Monday but failed to reach agreement, with France’s Roland Lescure saying the group was “not there yet” on a deal.

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The G7 was exploring a coordinated release of emergency oil reserves to tamp down fears of an impending shortage but stopped short of a deal.

Japan’s finance minister, Satsuki Katayama, said the International Energy Agency (IEA) explicitly requested the coordinated release during the G7 meeting, according to Bloomberg.

Brent crude briefly hit $119.50 a barrel on Monday morning, its highest level since 2022, having jumped roughly 25% since Friday as the Iran war intensified, raising fears over global production and shipping.

At the time of writing, oil prices pared gains and are trading slightly below $100 a barrel, as markets remain highly volatile.

Stock markets fell worldwide on concerns the global economy would not be able to absorb a sustained oil price shock.

Equity markets drop over uncertainty

At the open on Monday, the S&P 500 fell 1.3%, coming off its worst week since October. The Dow Jones Industrial Average was down 1.5% and the Nasdaq composite 1.2% lower.

The most immediate pain on Wall Street is hitting companies with large fuel bills. Carnival lost 7.3%, United Airlines sank 6.9% and Old Dominion Freight fell 3.8%.

Retailers dependent on long-haul shipping, whose customers are also facing higher petrol costs, also struggled. Best Buy fell 4.4% and Williams-Sonoma dropped 4%.

The moves followed steeper losses in European and Asian markets, where economies are more exposed to imported oil and gas. South Korea’s Kospi sank 6%, Japan’s Nikkei 225 dropped 5.2% and Europe’s Euro Stoxx 50 tumbled 1%.

Potential stagflation scenario

Since the war with Iran began, the central worry for financial markets has been how high oil prices will go and how long they will stay there.

If prices stay very high for very long, household budgets already stretched by high inflation could break under the pressure.

Meanwhile, companies would see their own bills jump for key items such as fuel and stock items, as well as for powering their data centres.

It all raises the possibility of a worst-case scenario for the global economy: stagflation, or a period when economic growth stagnates and inflation remains persistently high.

Late on Sunday, President Donald Trump countered this narrative by assuring that high oil prices at the moment are both worth the cost and only temporary.

“Short term oil prices, which will drop rapidly when the destruction of the Iran nuclear threat is over, is a very small price to pay for U.S.A., and world, safety and peace,” he said in a post on Truth Social.

In the bond market, the yield on the 10-year Treasury held at 4.15%, where it ended Friday.

Worries about high inflation and oil prices are applying upward pressure on Treasury yields, while risks of a slowing economy are pulling in the opposite direction.

Concerns about stagflation deepened on Friday following a surprisingly weak US jobs report showing that employers cut more jobs last month than they added.

March 9 (UPI) — G7 finance ministers were set to hold an emergency meeting first thing Monday to discuss oil prices after Brent crude surged above $100 per barrel, with an option to release strategic reserves to calm the market on the table.

The virtual meeting, due to get underway at 8.30 EST, comes amid fears that disruption to oil and gas shipments from the Gulf via the Strait of Hormuz, which Iran has closed, could continue for some time, sending energy prices soaring and rattling financial markets.

The joint release of “emergency reserves,” if agreed, would be coordinated by the International Energy Agency, according to the Financial Times.

If G7 nations do release oil reserves, it would be the first time in four years since a crisis triggered by Russia’s full scale invasion of Ukraine triggered similar price shocks, although gas was hit the worst.

Exacerbated by escalating attacks on Gulf countries’ oil fields, refineries and storage plants — impacting their ability to produce and store product, as well as export it — Bent crude jumped more than 25% in Asian trade Monday, hitting a $119.50 per barrel high, before falling back with the price of West Texas Intermediate making similar moves.

Investors also reacted to fears that the crisis will push inflation and borrowing costs higher, with negative impacts for the global economy.

The key Nikkei 225 index in Japan slumped by more than 5% to end Monday down 2,892 points lower, with the jitters spilling over into Europe when the markets there opened.

At lunchtime Monday, the FTSE 100 in London was down 1.4%, Germany’s DAX was down 1.6% and the CAC 40 in Paris was off by more than 2.2%.

Former IEA head Neil Atkinson warned that unless there was a resolution to the situation in the Gulf and flows of oil resumed “very soon” the world faced a “potentially game-changing and unprecedented energy crisis,” even if the reserves were made available.

“Though there are oil stocks around the world, the point is that if this closure of the Strait persists, those oil stocks if they are deployed will be depleted and we are going to be in a situation where, with the oil production actually shut in, in Iraq and possibly in Kuwait and maybe even in time in Saudi Arabia, that we are going to be in a crisis the likes of which we have never seen before,” Atkinson told CNBC.