Oil Prices and the Iran War: What Expats Need to Know Right Now

March 2026

By Will Glyn

Oil markets are moving fast. Since the United States and Israel launched joint strikes on Iran on 28 February 2026, the price of crude oil has surged from around $67 a barrel to nearly $120 at its peak — before pulling back sharply this week. For expats living abroad, the consequences are real and wide-ranging: higher fuel and energy costs, inflationary pressure on living expenses, and volatility across investment portfolios. Here is what has happened, where things stand today, and what it means for your finances.

How the Conflict Started and Where It Stands Today

The war began in the early hours of Saturday 28th February 2026 when US and Israeli forces launched coordinated strikes on Iran, targeting nuclear facilities, oil infrastructure, and military installations. The conflict has since widened dramatically. Iran has retaliated with drone and missile strikes across the region, hitting refineries, LNG terminals, and military bases in Saudi Arabia, Kuwait, Qatar, the UAE, Bahrain, Iraq, Jordan, Turkey, Oman, and Azerbaijan. Iran has also launched multiple waves of ballistic missiles directly at Israel, while Hezbollah has simultaneously attacked targets in northern Israel. Closer to home for many expats, a drone — attributed to a pro-Iran militia — struck the RAF Akrotiri base in Cyprus on 1st March, with further drones intercepted on 1st and 4th March. The attack prompted partial evacuations of surrounding villages and the deployment of British, French, and Greek naval and air assets to the island.

As of today, 10th March, the war is entering its tenth day with no sign of a negotiated ceasefire. Iran's Revolutionary Guard has stated the country is prepared to sustain intensive operations for at least six months. Iran has also named Mojtaba Khamenei — son of the former Supreme Leader killed in the initial strikes — as its new Supreme Leader, which analysts say signals a hardening of Iran's position and reduces the likelihood of early talks.

President Trump has said the US military campaign is "very far ahead of schedule" and expects the conflict to end "very soon" — but has also stated no deal will be struck without Iran's "unconditional surrender." The contradictions have done little to calm markets.

The Strait of Hormuz: The World's Most Critical Oil Chokepoint

At the heart of the energy crisis is the Strait of Hormuz. This narrow waterway — around 36 kilometres wide at its narrowest point — sits along Iran's southern coast and is the route through which approximately 20% of the world's oil and a significant share of global LNG normally passes each day.

Since the war began, Iran's Revolutionary Guard has declared the strait closed and attacked several tankers attempting transit. The impact has been swift and severe:

• Ship transits through the strait have dropped by over 90% since the war began, with some trackers recording near-zero commercial crossings by early March, according to S&P Global Market Intelligence and MarineTraffic.
• Insurance firms have suspended war-risk coverage for vessels in the region, making passage commercially unviable for most operators.
• With nowhere to ship their oil, Iraq, Kuwait, and Bahrain have already been forced to cut production as onshore storage capacity fills up.
• Analysts at Societe Generale warn the UAE may be the next producer forced to shut in output within the coming days.

The problem is not simply the closure itself — it is what comes after. Even once the strait reopens, oilfields that have been forced to halt production can take weeks or months to return to full output, depending on the type of field and how long it has been offline. Supply disruption, in other words, could outlast the conflict itself.

Where Oil Prices Are Right Now

Oil markets have been extraordinarily volatile. Here is how prices have moved since the conflict began:

• Pre-war (28 February): Brent crude was trading at approximately $67 per barrel.
• By end of first week (7 March): Prices had closed just under $93 per barrel.
• Sunday 8 March: Markets reopened to a shock — Brent and WTI crude briefly surged to nearly $120, their highest levels since Russia's invasion of Ukraine in 2022. The parity between the two benchmarks — unusual under normal conditions — reflected the severity of the global supply shock.
• Monday 9 March: Prices pulled back sharply after President Trump suggested Iran had "nothing left" militarily and hinted the strait could reopen soon. Brent settled at around $99 before falling further.
• Tuesday 10 March (today): Brent crude is trading around $91 per barrel and WTI around $87, both down approximately 8% — but still roughly 35% higher than pre-war levels.

Analysts remain divided on the direction from here. Some see the pullback as markets pricing in a swift resolution. Others — including ExxonMobil's chief economist Tyler Goodspeed — warn that the "more probable scenarios" are those in which the strait remains closed for longer, not shorter. Macquarie Research has warned that oil could reach $150 per barrel by the end of March if the strait stays shut.

Beyond Crude: Gas, LNG, and Wider Energy Costs

The disruption is not limited to oil. Qatar — one of the world's largest LNG exporters, supplying roughly 20% of global liquefied natural gas — declared force majeure on its gas exports following Iranian drone strikes. Sources suggest it could take at least a month for production to return to normal levels. European natural gas prices have surged by more than 20% as a result.

For expats living in Europe or Asia — regions that are heavily dependent on Gulf energy — the immediate cost-of-living implications are already being felt. Diesel prices have doubled in parts of Europe. Jet fuel costs in Asia have risen by close to 200%, according to Rystad Energy — relevant not just for travel but for aviation-heavy economies across the region.

Saudi Aramco's Ras Tanura refinery and export terminal — one of the world's largest — has been closed following attacks. The Aramco CEO has warned of "catastrophic consequences" and described the situation as the biggest crisis the region's oil and gas industry has ever faced.

What the G7 and IEA Are Doing About It

Governments and international institutions have moved quickly to try to manage the shock. On Monday, G7 finance ministers held an emergency virtual meeting and issued a statement pledging to take "necessary measures" to support global energy supply. However, the G7 stopped short of committing to a coordinated release of strategic reserves, with a decision deferred to a separate meeting of G7 energy ministers on Tuesday. Three G7 nations, including the US, were reported to be supportive of a release, but no agreement had been reached as of Tuesday morning.

The International Energy Agency (IEA) has said it is in close contact with energy ministers worldwide and has confirmed that IEA member countries hold over 1.2 billion barrels in public emergency stocks, with a further 600 million barrels held under government obligation.

However, analysts are cautious about how much this can help. Multiple experts have noted that strategic reserves would provide only temporary relief — a stopgap rather than a solution. The only durable fix, as several analysts have put it plainly, is the reopening of the Strait of Hormuz.

What This Means for Expats Living Abroad

For expats living and working abroad, the conflict has several direct financial implications worth considering:

Energy and cost of living costs: If you are living in a country that is heavily reliant on Gulf energy — particularly in Europe, Southeast Asia, the Middle East, or South Asia — you are likely to see higher fuel, electricity, and heating costs. This could also feed into broader inflation through transport and food supply chain disruption.

Investment portfolios: Oil price spikes of this magnitude tend to have significant knock-on effects across equity markets. Energy stocks typically benefit, but broader indices can suffer — particularly in sectors like airlines, chemicals, manufacturing, and consumer goods. The Dow Jones fell nearly 900 points at one point on Monday, and Asian markets saw major declines. Portfolio diversification and your exposure to energy-sensitive sectors deserve a review.

Currency exposure: Oil price shocks can affect currency markets in ways that are difficult to predict. The US dollar has strengthened against both the euro and yen as a result of this crisis, and currencies in oil-importing nations have come under particular pressure. For expats transferring money between currencies — whether maintaining financial commitments back home, managing savings across multiple countries, or simply meeting day-to-day living costs — currency movements during periods of energy-driven volatility are worth monitoring carefully.

Inflation risk: Higher oil prices flow through into wider inflation — particularly transport, utilities, and food. Central banks that were expecting to cut rates in 2026 may now need to pause or reconsider.

Longer-term uncertainty: Even if a ceasefire is reached relatively soon, analysts caution that supply disruptions could persist for months due to damaged infrastructure, production shut-ins, and cautious shipping operators. The energy price environment for the rest of 2026 is likely to be significantly more volatile than it looked even a fortnight ago.

How We Can Help

The situation in the Middle East is evolving daily. While no one can predict exactly how markets will move, you can make sure your financial plan is built to withstand volatility and that your exposure to energy price risk is appropriate for your circumstances.

At Proctor Wealth Associates, we work with expats across the world to review investment portfolios, manage currency exposure, and plan for inflationary environments. If you want to talk through what the current situation means for your finances, we would be happy to help.

Book a conversation with our team at www.pwa-intl.com/book.

Will is an Independent Financial Adviser with over a decade of experience helping expats make the most of their international status.