Oil prices surged above $79.40 per barrel on Monday, March 3, 2026, as escalating conflict in the Middle East effectively halted much of the shipping traffic through the Strait of Hormuz, a critical artery for global energy supplies. Iran’s Revolutionary Guard Corps (IRGC) declared the strait “closed” and threatened to attack any vessel attempting passage, according to reports from Al Jazeera and Reuters.
The disruptions follow joint military strikes by the United States and Israel against Iranian targets over the weekend. At least five tankers have been damaged, resulting in two fatalities and leaving approximately 150 ships stranded in and around the strait, which separates Iran and Oman, Al Jazeera reported. The U.K. Maritime Trade Operations Center has as well reported attacks on several vessels and warned of elevated electronic interference impacting ship navigation systems, according to CBS News.
The Strait of Hormuz, roughly 100 miles long and narrowing to just 21 miles at its most constricted point, facilitates the flow of roughly one-fifth of the world’s oil and liquefied natural gas (LNG), according to the U.S. Energy Information Administration and analyses from the Christian Science Monitor. Saudi Arabia, the United Arab Emirates, Iraq, Kuwait, Qatar, and Iran all rely on the strait for exporting energy resources. A complete stoppage, or even a prolonged delay, could send global oil prices soaring, analysts warn.
“Infrastructure is at risk throughout the region, and it’s not just at risk because of deliberate attacks, but also inadvertent attacks,” said Kevin Book, managing director at Clearview Energy Partners, as reported by CBS News. “Shrapnel and debris from missile interceptions can fall onto facilities and disable them too, and so there are a number of challenges that come from this kind of conflict in an area with so much energy production.”
Shipping traffic has decreased by at least 80 percent, according to Michelle Bockmann, a senior maritime intelligence analyst at Windward, as reported by Al Jazeera. The shipping industry was already experiencing a “huge spike” in freight costs for routes originating in the Middle East and the Gulf prior to the recent escalation.
The crisis is also impacting natural gas supplies. Qatar halted natural gas production following Iranian attacks, according to Al Jazeera, raising concerns about a potential growth shock for Europe and Asia, CNBC reported. The conflict has prompted a reassessment of energy security strategies in both regions.
As of late Monday, no diplomatic initiatives to reopen the Strait of Hormuz had been publicly announced. The Iranian government has not responded to calls for de-escalation from the United States or Israel, and the IRGC’s commander has maintained the threat to attack any vessel attempting transit.
