Osmond ChiaEconomic journalist
Reuters
Brent crude rose almost 9% to $100 ($74.79) a barrel in Asian trade, even after the 32-member International Energy Agency (IEA) announced it would release 400 million barrels in response to supply problems.
Iran warned on Wednesday that oil could hit $200 a barrel as its attacks on shipping intensify in the Strait of Hormuz, a key waterway for energy shipments.
A spokesman for the Islamic Revolutionary Guard Corps (IRGC) said any vessel linked to the United States, Israel or their allies would be targeted.
“You won’t be able to artificially lower the price of oil. Expect an oil price of $200 a barrel,” the spokesperson said.
“The price of oil depends on regional security, and you are the main source of insecurity in the region.”
This narrow sea route is crucial to the global economy, as about a fifth of the world’s energy supplies usually pass through it.
IEA members account for approximately two-thirds of global energy production and consumption.
The release of reserves is more than double the IEA’s previous record, set after Russia’s invasion of Ukraine in 2022.
The IEA’s decision is “historically significant” but only a “temporary buffer”, said Martin Ma of the Singapore Institute of Technology.
Oil prices will remain high as long as there is a risk to supply and the latest rise suggests traders are still expecting a “prolonged” disruption, he added.
Global oil markets have been extremely volatile since the United States and Israel launched airstrikes against Iran on February 28, with Brent crude reaching nearly $120 a barrel earlier this week.
This has driven up fuel prices around the world.
The average price of gasoline in the United States topped $3.50 per gallon on Tuesday, according to the American Automobile Association.
Many Asian countries, heavily dependent on energy from the Middle East, have been particularly affected.
Long queues were seen at gas stations in the Philippines, Thailand and Vietnam this week as people ran to refuel.
Thai authorities have called on staff at most government agencies to work from home to save energy. Civil servants are also discouraged from non-essential overseas travel.
The Philippines also introduced a four-day work week for its government to help reduce energy consumption.
