Nikkei Falls, Gas Prices Soar as Middle East Oil Crisis Ripples Across Asia and Europe

The economic ripple effects of the Middle East oil crisis spread far beyond the Gulf region Thursday, hitting Asian stock markets and pushing European natural gas prices sharply higher for a second consecutive day. Japan’s Nikkei 225 fell 1.6% and South Korea’s Kospi lost 1.2% as investors digested the implications of continued Iranian strikes on energy infrastructure. European natural gas prices gained 7.7%, reflecting concerns about broader energy supply disruption.
Iran struck merchant ships near the Strait of Hormuz, hit fuel storage tanks in Bahrain, and attacked oil tankers near Iraq’s export ports. Three crew members aboard the Thai-flagged Mayuree Naree were reported trapped following a ship strike. Iraq suspended all crude oil exports, while Oman cleared its Mina Al Fahal terminal in response to drone attacks on a neighboring port.
Brent crude rose about 6% to nearly $98 a barrel after briefly crossing $100. West Texas Intermediate gained 8.6% to $94.75. Both benchmarks have risen dramatically from their levels at the start of 2026, when oil traded around $60 a barrel. Iran escalated verbally as well as militarily, with its military warning of $200-per-barrel oil.
The IEA’s 32 members jointly released 400 million barrels of emergency crude in an unprecedented coordinated action. The US announced a 172-million-barrel release from its Strategic Petroleum Reserve. President Trump pledged to continue military operations against Iran and framed the reserve release as a consumer protection measure.
Goldman Sachs raised its Q4 2026 Brent forecast to $71 a barrel. Deutsche Bank’s Jim Reid warned of a stagflationary shock risk for global markets. Without clear signs of de-escalation, analysts say the pressure on both oil and gas prices is unlikely to ease significantly in the near term.