Iran war drives Brent crude to $90 and cuts oil flows through Hormuz

The Iran war has reshaped global energy markets, with Brent crude trading around $90 a barrel, about 25% above its level before the first strikes on Feb. 28, Bloomberg reported.

Tanker traffic through the Strait of Hormuz has fallen to roughly 2.2 million barrels a day, compared with the approximately 20% of global seaborne oil that moved through the waterway before the conflict. Commercial operators have been reluctant to risk vessels in an active war zone.

Iran’s oil exports have dropped to about 250,000 barrels a day, an 85% decline from pre-war levels. The disruption has also reduced Middle Eastern refining output by roughly 20% and pushed European diesel prices more than 70% higher.

The United States and European allies have released oil from strategic reserves to ease the supply shock. The US Strategic Petroleum Reserve has fallen to its lowest level since the 1980s, leaving less capacity to absorb another disruption.

Developing Asia’s energy-import bill is projected to reach $160 billion in 2026, reflecting the cost of higher crude, fuel and shipping prices.