The ongoing armed conflict between Israel and Iran has intensified concerns over the stability of global energy markets, leading to an increase in crude oil prices, while the price for natural gas has also begun to rise.

Analysts indicate that these fluctuations could have significant implications, especially for Europe, which is currently engaged in winter gas storage preparations.

Following a series of aerial attacks by Israel that targeted Iranian energy facilities, analysts from various sectors are now voicing a consensus that further price increases for crude oil may be likely.

The price of crude oil has begun to surge amid fears of heightened military actions and subsequently, geopolitical uncertainty is fuelling market volatility.

Two primary factors that may drive oil prices further upward have been identified.

Firstly, if Iran were to close the Strait of Hormuz, through which 30-50% of the world’s oil trade transits annually, it could result in a rapid escalation of oil prices.

Iranian officials have suggested that such a measure is under consideration, which echoes scenarios from 2018 when tensions led to similar actions.

However, a closure would also hinder Iran’s ability to export oil to its major markets, including China, Japan, and South Korea.

Consequently, the economic ramifications would likely be profound for Iran itself, although it remains a conceivable option.

Moreover, alternative shipping routes, such as the Bab el-Mandeb Strait, are not yet operational, and shipments through these territories could be vulnerable to attacks from Iranian-backed groups.

Secondly, the likelihood that Israel will enhance its military operations against Iranian oil and gas facilities may also contribute to rising prices.

The recent Israeli attacks on Iranian infrastructure included airstrikes on gas facilities that momentarily disrupted market activity.

Estimates indicate that if the Strait of Hormuz were to be closed, North America could face a minor deficit of approximately 1 million barrels, while Europe could see losses more significant than that, despite not being one of Iran's primary markets.

The market reaction to Israeli military operations has produced noticeable immediate effects on pricing; however, analysts suggest that if the intensity of military confrontations does not escalate, pressure on oil prices may diminish in the near future.

As the situation evolves, the broader implications for the global energy markets continue to develop, highlighting the intricate balance of geopolitics and energy supply in a volatile region.