The oil and \u200cgas crisis triggered by the blockade of the strait of Hormuz is \u201cmore serious than the ones in 1973, \u200b1979 and 2022 together\u201d, the head of the International Energy Agency (IEA) has said, as Donald Trump\u2019s deadline for Iran to reopen the waterway approached on Tuesday.<\/p>\n
Fatih Birol, the executive director of the IEA, told \u2060Le Figaro newspaper that the impact of the Middle East conflict on the oil market was larger than the combined force of the twin shocks of the 1970s and the fallout from Russia\u2019s invasion of Ukraine.<\/p>\n
He also said the countries most at risk were developing nations, \u200cwhich \u2060would suffer from higher oil and gas prices, higher food prices and a general acceleration of inflation, while European countries, Japan and Australia would also feel an impact.<\/p>\n
Oil traded at more than $110 (\u00a383) a barrel on Tuesday after Trump warned that a \u201cwhole civilization will die tonight\u201d unless Iran made a deal.<\/p>\n
Brent crude, the international benchmark for oil prices, was up 0.7% at $110.60 a barrel in early afternoon trading in Europe, with New York light crude up 2.5% to $115.17 a barrel.<\/p>\n
Oil price chart<\/a><\/p>\n Investors are growing increasingly anxious as Trump escalates his threats against Iran<\/a>, demanding that it reopen the strait of Hormuz as part of any deal to stop the war.<\/p>\n The US president posted on his Truth Social site: \u201cA whole civilization will die tonight, never to be brought back again. I don\u2019t want that to happen, but it probably will.\u201d<\/p>\n There were also reports that the US had hit military targets on Kharg Island, the site of a key Iranian oil export terminal.<\/p>\n Daniela Hathorn, a senior market analyst at Capital.com, said: \u201cMarkets are once again on edge as the US-Iran conflict enters a critical phase, with investors effectively trading against another countdown clock set by the Trump administration.<\/p>\n \u201cThe situation has evolved into a near-term binary outcome: either escalation through direct strikes on Iranian infrastructure, or a last-minute de-escalation that could trigger a sharp reversal in risk assets. For now, the absence of a clear path forward is keeping markets volatile and indecisive.\u201d<\/p>\n The US president, speaking to reporters at the White House on Monday, set a deadline of Tuesday 8pm ET (1am BST Wednesday) for Iran to agree a deal with Washington or face fresh attacks on civil infrastructure, including power plants. \u201cThe entire country can be taken out in one night, and that night might be tomorrow night,\u201d Trump said.<\/p>\n