The ongoing conflict between the United States, Israel, and Iran has the potential to significantly impact global fuel prices, leaving both consumers and businesses facing increased costs for weeks or even months, according to analysts.

Even if peace is restored swiftly, the aftermath will involve dealing with damaged infrastructure, disrupted supply chains, and heightened risks associated with shipping routes.

This situation represents a global economic concern and could pose a political challenge for US President Donald Trump, especially with midterm elections on the horizon.

JP Morgan analysts have noted, “The market is transitioning from merely pricing in geopolitical risks to confronting actual operational disruptions, with refinery shutdowns and export limitations affecting crude processing and regional supply flows.”

The conflict has already resulted in the halt of about 20% of the world’s crude and natural gas supply, as Iran targets vessels in the crucial Strait of Hormuz and attacks energy facilities across the region.

Since the conflict began, global oil prices have surged by over 25%, leading to increased fuel costs for consumers around the globe.

A nearly complete shutdown of the Strait means the region’s giant oil producers – Saudi Arabia, the United Arab Emirates, Iraq and Kuwait – have had to suspend shipments of as much as 140 million barrels of oil – equal to about 1.4 days of global demand – to global refiners.

As a result, oil and gas storage at facilities in the Middle East Gulf are rapidly filling, forcing oil fields in Iraq and Kuwait to cut oil production, with the United Arab Emirates likely to cut next, analysts, traders and sources have said.