Energy Markets Face Mounting Pressure from Regional Tensions and Supply Disruptions

Economic expert Munir Diyeh warned that regional tensions, the Russia-Ukraine war, and disruptions to transport and supply routes are pushing global energy markets higher.

As winter approaches, demand for energy is expected to rise, further elevating global oil prices. The prolonged crises have damaged refineries and production and supply lines, making it difficult to transport energy to global markets.

The damage to refineries and supply lines has been exacerbated by disruptions to strategic reserves in major industrialized countries, concerns over oil supplies, and reduced shipping through the Bab al-Mandab and Strait of Hormuz. These factors have driven up marine insurance costs, contributing to tighter global energy supplies and higher prices.

Diesel prices are particularly affected, with reduced refining capacity at several refineries making it harder to meet demand. The approaching winter is expected to further increase global diesel demand, potentially pushing prices even higher.