Oil, gas prices rise as Iraq, Qatar halt output at major fields

GLOBAL oil markets rallied sharply after Iraq began cutting production at some of its largest southern oil fields, highlighting escalating supply risks tied to mounting regional instability, Oilprice.com reported.

Iraqi oil officials disclosed that output has been curtailed at the Rumaila oil field, one of the country’s most critical production hubs. Meanwhile, the West Qurna 2 field is shutting in about 460,000 barrels per day. The move follows heightened tensions that have effectively stalled tanker traffic through the Strait of Hormuz, a vital corridor for global crude shipments.

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Officials said constrained navigation and a shortage of available tankers have pushed storage facilities at southern export terminals close to capacity. With crude inventories swelling and export channels clogged, authorities were left with little choice but to scale back upstream production to ease pressure on logistics.

In a separate development, a drone strike targeted the Port of Fujairah, the United Arab Emirates’ largest oil export terminal located outside the Strait of Hormuz. The attack, which reportedly hit storage tanks and related infrastructure, sent thick plumes of smoke into the air and amplified concerns about the vulnerability of Gulf energy assets. Although there have been no confirmed reports of catastrophic structural damage, the incident has intensified fears of broader disruptions across regional export infrastructure.

The Strait of Hormuz accounts for roughly one-fifth of global oil flows. Any sustained interruption in traffic through the narrow passage materially tightens the seaborne crude market, particularly for Middle Eastern barrels bound for Asia.

Reflecting these developments, oil prices climbed steeply as traders factored in a rising geopolitical risk premium and the prospect of wider supply interruptions. As of 09:30 EST on Tuesday, Brent crude futures had jumped to $83.918 per barrel, while West Texas Intermediate (WTI) futures surged 8.75 percent to $76.26 per barrel.

Rising gas price, output disruption

Also, gas prices spiked on Monday after QatarEnergy, one of the world’s biggest exporters, halted production following attacks on its facilities.

The average price for a gallon of gasoline jumped 11 cents overnight to about $3.11 in the U.S., according to motor club AAA. European (EU) natural gas prices surged more than 20 percent at the start of the week as tensions in the Middle East rattled energy markets and raised fears of supply disruptions.

Global energy markets were thrown into turmoil on Monday after QatarEnergy announced a complete halt to its liquefied natural gas (LNG) production, effectively taking the country’s entire export capacity offline. The unprecedented shutdown followed Iranian drone strikes on key energy installations at Ras Laffan Industrial City and Mesaieed Industrial City, removing nearly a fifth of global LNG supply from circulation and intensifying volatility across international fuel markets.

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In a statement published Monday, QatarEnergy confirmed that military attacks had struck its operational facilities in Ras Laffan and Mesaieed, forcing the suspension of LNG output and related products. The company did not indicate when production might resume, leaving importers and traders grappling with uncertainty over the duration of the disruption.

The strikes formed part of a wider escalation in the Gulf, triggered by Iranian retaliation linked to ongoing U.S. and Israeli military operations in the region. Energy infrastructure has increasingly become a focal point in the confrontation. In neighboring Saudi Arabia, operations at the Ras Tanura oil refinery were halted, while other oil and gas facilities across the Middle East have scaled back output as a precaution amid security concerns.

Qatar ranks among the world’s top LNG exporters, with production spread across about 14 liquefaction trains. Before the outbreak of hostilities, the country accounted for roughly 20 percent of global LNG export capacity, making it a cornerstone supplier to Europe and Asia. The abrupt suspension has dramatically tightened supply conditions, raising concerns among analysts that gas prices, which are already elevated due to geopolitical tensions, could surge further in the coming days.