Asian stock markets fell sharply following attacks on natural gas facilities in Qatar, Iran, and the United Arab Emirates, spelling new turmoil for global energy supplies. The incidents delivered a negative shock to markets already grappling with regional instability.
Japan’s benchmark Nikkei 225 and South Korea’s KOSPI tumbled nearly 3 percent in early Thursday trading. This decline rattled markets already reeling from the effective closure of the Strait of Hormuz and the continued blocking of oil and gas exports from the Gulf region. Futures for Brent crude, the global benchmark for oil prices, rose more than 4 percent to top $112 a barrel—the highest level in over a week.
According to the International Gas Union, Japan and South Korea, Asia’s third- and fifth-largest economies respectively, depend on imported fossil fuels to meet between 80 and 90 percent of their energy needs. In 2024, they also ranked as the world’s second- and third-largest importers of liquefied natural gas (LNG), taking 68 million tonnes and 47 million tonnes, respectively. Qatar accounted for 77.2 million tonnes of supply that year, making it the world’s third-largest LNG exporter after the United States and Australia.
Jason Feer, global head of business intelligence at Poten & Partners, called the attacks on energy facilities a “major escalation” in the regional conflict. In an interview with Al Jazeera, he stated: “The disruption of traffic through the Strait of Hormuz has had a major impact on energy markets, to be sure. But damage to energy installations has been quite light so far. Damage from attacks on oil and gas production and processing facilities could take a long time to repair, ensuring that supplies are disrupted into the future even if the shooting were to stop.”
Qatar said on Wednesday that its main LNG export facility at Ras Laffan Industrial City, the largest plant of its kind worldwide, suffered “significant damage” following Iranian missile attacks. The state-run energy company QatarEnergy said in a later statement that several other LNG facilities were also attacked, “causing sizeable fires and extensive further damage.”
In a Truth Social post late Wednesday, US President Donald Trump warned Iran against any further attacks on Qatar, threatening to “massively blow up the entirety” of the South Pars gas field if Tehran struck Qatar’s energy facilities again. The UAE said it suspended operations of the Habshan gas facility and the Bab oilfield due to falling debris after its forces successfully intercepted Iranian missile attacks.
Saudi Arabia said it had also intercepted an attempted drone strike on a gas facility in the kingdom’s eastern region, as well as missile attacks on the capital Riyadh. Iran’s attacks across the Gulf came after Tehran pledged to retaliate for strikes by Israel on its South Pars gas field, the world’s largest.
The attacks on critical energy infrastructure across the Middle East have heaped further pressure on energy prices as maritime traffic through the Strait of Hormuz has collapsed amid the threat of Iranian attacks. Only a handful of ships, mostly Indian, Pakistani, and Chinese-flagged vessels, have transited the waterway each day since the war began 20 days ago. Oil prices have risen more than 50 percent as a result of the conflict, which began with US-Israeli strikes on Iran on February 28.
Source: www.aljazeera.com