The ongoing Iran conflict has significantly disrupted global oil and LNG supply, with Brent crude prices rising sharply and the International Energy Agency (IEA) warning that the global natural gas market will remain tight for at least two more years [1]. According to BNY’s Bob Savage, the conflict has removed around one-fifth of global oil and LNG supply, and damage to Qatari facilities has reduced liquefaction capacity, potentially delaying new supply growth led by the US for years [1]. The IEA estimates a cumulative shortfall of approximately 120 billion cubic meters between 2026 and 2030, reinforcing expectations of prolonged tight market conditions [1]. In response to higher prices and policy measures, gas demand has softened in key importing regions, particularly Asia, as consumers switch fuels and reduce consumption [1].
Brown Brothers Harriman’s Elias Haddad notes that the US-Iran standoff in the Strait of Hormuz is keeping Brent elevated, with prices climbing for a fifth consecutive day and trading above $107 a barrel—the highest since April 7, though still below the March peak of around $120 a barrel [2]. Despite the ongoing energy shock, BBH suggests the worst is likely over, citing the US's indefinite extension of the ceasefire and its 'Open for All or Closed to All' navigation policy, which may accelerate the reopening of the Strait of Hormuz due to shared economic pain incentivizing diplomatic solutions [2].
Market reactions include firmer crude oil prices pushing up central bank rate expectations and global bond yields grinding higher [2]. The US Dollar Index (DXY) remains mixed near yesterday’s high, with BBH expecting interest rate differentials to keep DXY anchored within its established 96.00–100.00 range in the coming weeks [2]. The final April print of the University of Michigan consumer sentiment index is also due today, though no further details are provided [2].
While both sources highlight the impact of the Iran conflict on energy markets, BNY emphasizes the prolonged tightness in oil and gas supply and delayed LNG expansion, whereas BBH focuses on the easing of the energy shock for the US Dollar and the potential for diplomatic progress in the Strait of Hormuz [1][2].
CONCLUSION
The Iran conflict continues to disrupt global oil and gas supply, supporting elevated Brent prices and reinforcing a tight market outlook. However, US diplomatic efforts and policy measures are seen as easing the worst of the energy shock, with the US Dollar Index expected to remain stable within its established range. Market participants should remain alert to ongoing supply risks and potential diplomatic developments.