Energy Markets Plunge as Iran-Israel Conflict Escalates

Asian stock markets experienced sharp declines on Thursday, March 19, 2026, following attacks on natural gas facilities in Qatar, Iran, and the United Arab Emirates, intensifying concerns about global energy supplies. The attacks have rattled markets already strained by the effective closure of the Strait of Hormuz and disruptions to oil and gas exports from the Gulf region.

Asian Markets Tumble

Japan’s Nikkei 225 and South Korea’s KOSPI both fell nearly 3 percent in early trading. These declines follow substantial losses in US stocks overnight, fueled by growing inflation fears. Japan and South Korea heavily rely on imported fossil fuels, meeting 80 to 90 percent of their energy needs. In 2024, they were the second- and third-largest importers of liquefied natural gas (LNG), respectively, importing 68 million and 47 million tonnes, according to the International Gas Union.

Oil Prices Surge

Brent crude futures, the global benchmark for oil prices, rose more than 4 percent, surpassing $112 a barrel – the highest level in over a week. The conflict, which began with US-Israeli strikes on Iran on February 28, has already driven oil prices up by more than 50 percent.

Attacks and Retaliation

Qatar reported “significant damage” to its main LNG export facility at Ras Laffan Industrial City following Iranian missile attacks. QatarEnergy stated that several other LNG facilities were also targeted, resulting in “sizeable fires and extensive further damage.” The UAE suspended operations at the Habshan gas facility and the Bab oilfield after successfully intercepting Iranian missile attacks. Saudi Arabia also reported intercepting a drone strike on a gas facility and missile attacks on Riyadh.

Iran’s Response and US Warning

Iran’s attacks across the Gulf region were in response to Israeli strikes on its South Pars gasfield, the world’s largest. US President Donald Trump issued a warning to Iran via his Truth Social account, threatening to “massively blow up the entirety” of the South Pars gasfield if Tehran were to attack Qatar’s energy facilities again.

Strait of Hormuz Disruption

The disruption of maritime traffic through the Strait of Hormuz has significantly impacted energy markets. Only a limited number of ships, primarily flagged by India, Pakistan, and China, have transited the waterway since the conflict began 20 days ago.

Industry Expert Analysis

Jason Feer, global head of business intelligence at Poten & Partners, described the attacks on energy facilities as a “major escalation” in the regional conflict. He noted that while the disruption of traffic through the Strait of Hormuz has had a major impact, damage to energy installations could lead to prolonged supply disruptions, even if hostilities cease.

Key Takeaways

• Attacks on energy infrastructure in Qatar, Iran, and the UAE have escalated the conflict and increased market volatility.
• Oil prices have surged by over 50 percent since the conflict began on February 28.
• Disruption to the Strait of Hormuz is severely impacting global energy supplies.
• The US has warned Iran against further attacks on Qatar, threatening retaliation against the South Pars gasfield.