Oil prices surged past $106 a barrel, as tensions in West Asia escalated, leading to the effective closure of the Strait of Hormuz.
The conflict has intensified fears of a prolonged global supply shock, with oil prices rising over 40% since the war began.
This has impacted global economies and consumer fuel costs.
Oil prices climbed again on March 15, 2026 as escalating tensions in West Asia and the effective closure of the Strait of Hormuz, one of the world’s most strategically important oil transit routes, intensified fears of a prolonged global supply shock.
Brent crude, the international oil benchmark, rose 3 per cent to top $106 a barrel, before easing slightly in early trading on March 16. It was $104.63 a barrel at 10 am IST, up nearly 1.5 per cent.
The prices climbed toward $120 for the first time on March 9, the highest level since the Russia and Ukraine war in 2022.
The surge follows a sharp escalation in the conflict involving the United States (US), Israel and Iran, including US strikes on Iran’s key oil export hub at Kharg Island. The five-mile-long island processes about 90 per cent of Iran’s oil exports and is a critical part of the country’s energy infrastructure.
Donald Trump told NBC News March 14 that US strikes had “totally demolished” much of Kharg Island, and that the US military could target the site “a few more times just for fun”. The five-mile-long coral island, located about 27 miles off Iran’s mainland in the Persian Gulf, serves as a crucial processing hub through which roughly 90 per cent of the country’s oil exports usually pass.
Trump also said on social media that the US had deliberately avoided hitting oil and energy facilities on the island “for reasons of decency”, insisting that only military targets were struck.
US President Donald Trump has called on allies and other major economies to help reopen the strait, which typically carries about one-fifth of the world’s oil supply. However, the response has been limited so far. Japan and Australia said on March 16 they had no plans to send naval vessels to the region, while other countries have not publicly committed to joining a maritime security effort. In an interview with the Financial Times, Trump warned that NATO could face a “very bad” future if allies failed to respond positively to the proposal.
Shipping through the Strait of Hormuz has nearly come to a standstill since Iran moved to halt traffic in retaliation for the US-Israel strikes. According to the United Kingdom Maritime Trade Operations, only about five ships have been transiting the strait daily since the war began on February 28, compared with a historical average of roughly 138.
At least 16 commercial vessels have been attacked in the region since the conflict began, the monitoring centre said.
The disruption has triggered what the International Energy Agency described as the largest shock to global energy supplies in history. Oil prices have risen more than 40 per cent since the start of the war, raising concerns about higher fuel costs and a possible slowdown in the global economy.
The impact is already being felt by consumers. In the US, average petrol prices reached $3.70 per gallon on March 15, according to the American Automobile Association, up 62 cents from a month earlier.
Meanwhile, governments across Asia are scrambling to manage the energy shock. Countries, including Thailand and Bangladesh, are considering measures such as fuel subsidies and rationing as the conflict threatens to prolong disruptions in global oil markets, according to reports by The Guardian.