Global energy markets are once again on edge, with Donald Trump recently suggesting the conflict could last “four weeks,” volatility has returned to oil and gas markets at speed. Whether that timeline proves accurate or not, traders are already pricing in the risk of prolonged disruption,and households may soon feel the consequences.
In the past 48 hours, European gas prices have surged by 25% in a single day, reflecting immediate supply fears and extreme volatility. Europe is particularly exposed: gas storage levels sit at roughly 30% capacity following winter, making prices more sensitive to geopolitical shocks than in other regions.
Oil markets are also tightening. Global crude prices have climbed 9–10% in recent days, adding fresh inflationary pressure across economies already struggling with high living costs. The impact is not confined to Europe. If the conflict persists, LNG and gas markets in Asia and other import-dependent regions are likely to follow, with further price spikes possible as supply chains come under strain.
At the heart of the crisis is a chokepoint of global energy trade. Iran holds the world’s third-largest oil reserves, and the Strait of Hormuz carries roughly one-fifth of global oil and gas supply. Any disruption there reverberates worldwide,from wholesale markets to petrol stations to supermarket shelves.
For fossil fuel producers, however, volatility can mean profit. If prices continue to climb, we are likely to see a new wave of windfall profits across the oil and gas sector. The financial burden of those profits will ultimately land on the kitchen tables of ordinary households through higher energy bills, more expensive transport and rising food prices.
We have seen this dynamic before. In 2022, energy and food price shocks triggered by the war in Ukraine pushed more than 70 million people into poverty within just three months, according to the United Nations Development Programme.
The lesson is stark: when fossil fuel markets spike, it is the most vulnerable who pay first and hardest.
Oil-producing countries are attempting to calm markets. OPEC+ has announced plans to raise output. But many analysts view the move as largely symbolic,insufficient to offset sustained supply disruption if the conflict deepens or shipping routes remain constrained.
The current crisis underlines a deeper structural problem and the situation exposes the “horrendous costs” of fossil fuel dependence. When a single geopolitical flashpoint can destabilise energy security worldwide, it raises urgent questions about resilience.
Renewable energy offers domestically generated, stable power less vulnerable to global shocks. While the transition requires upfront investment, it reduces exposure to precisely the kind of conflict-driven volatility now rippling through markets.
The immediate outlook remains uncertain. Much depends on the duration and geographic spread of the conflict. But the direction of travel is clear: if the war continues, fossil fuel prices are likely to rise further,alongside significant windfall profits for producers.