 ▲ Natural gas production facilities in Ras Laffan, Qatar |
On the 2nd (local time), the first trading day after the United States and Israel launched large-scale military operations against Iran, international oil prices and natural gas prices in Asia and Europe surged.
On the ICE Futures Exchange, Brent crude oil futures for May delivery closed at $77.74 per barrel, up 6.7% from the previous session.
During intraday trading, Brent futures jumped as much as 13% to $82.37 per barrel, reaching their highest level in over a year since January of last year.
On the New York Mercantile Exchange, West Texas Intermediate (WTI) crude futures for April delivery settled at $71.23 per barrel, up 6.3% from the previous session.
WTI futures also surged as much as 12% during trading to $75.33 per barrel, marking their highest level since June of last year.
Earlier in the day, Qatar’s Ministry of Defense said two Iranian drones had attacked a water tank at a power plant in Mesaieed, south of the capital Doha, and an energy facility in Ras Laffan in the north the previous day. Ras Laffan is Qatar’s main liquefied natural gas (LNG) production hub.
State-run energy company QatarEnergy (QE) subsequently announced that it had suspended LNG production in Ras Laffan in response to the Iranian attack.
In Saudi Arabia, a drone that approached the country’s largest oil refinery was intercepted, resulting in a partial suspension of operations at the facility.
According to Reuters, front-month natural gas futures on the Dutch TTF exchange closed at €44.51 per megawatt-hour (MWh), a 40% surge from the previous trading day.
Data from S&P Global Platts cited by Reuters showed that the LNG Japan-Korea Marker (JKM), a benchmark for Northeast Asian natural gas prices, rose about 40% on the day to $15.068 per million British thermal units (mmBtu).
Market participants believe international oil prices could easily surpass $100 depending on factors such as a prolonged full blockade of the Strait of Hormuz, disruptions to Iranian crude supplies, and whether additional oil facilities in the Middle East come under attack.
The Strait of Hormuz handles not only crude oil but also about 20% of global liquefied natural gas (LNG) shipments.
Disclaimer: This article is provided for informational purposes only and does not constitute investment advice.