Key Takeaways
Iran’s assertion on April 4 that its oil exports are rising introduces fresh uncertainty to global energy markets, with Brent crude prices holding over $100 a barrel as the war with the U.S. and Israel intensifies regional supply disruptions.
"Iran's oil exports have increased," the chairman of the Iranian Parliament's Energy Committee said on Thursday, adding that the country's fuel supply is normal and has "made the necessary preparations for war."
The statement comes after a series of attacks on energy infrastructure across the Gulf, including drone strikes that caused fires at Kuwait’s Mina Al-Ahmadi refinery and damage to a power and desalination complex. In the UAE, facilities in Abu Dhabi have also been hit, with economists at HSBC noting that Brent crude averaged $100 in March.
The escalating conflict threatens to further tighten global energy supplies, forcing major importers to secure alternative sources and raising the risk of sustained high prices that could push inflation above the 6 percent tolerance band for central banks like the Reserve Bank of India.
The war, which began over a month ago, has expanded beyond direct military engagements to include strikes on vital economic targets. Kuwait reported "material damage" to a power and water facility from what it called an act of “Iranian aggression.” Separately, drone strikes targeted the Mina Al-Ahmadi refinery, a critical component of Kuwait's export capacity.
These incidents have heightened tensions around the Strait of Hormuz, a critical chokepoint for global oil shipments. While some tankers are hugging the coast of Oman to navigate the waterway, the risks have prompted international action, with the UN Security Council set to vote on a proposal to secure the strait. The war's economic fallout has prompted calls for a ceasefire from leaders like Russia's Vladimir Putin and Turkey's Recep Tayyip Erdogan, who noted the "serious negative consequences" for global energy and trade.
In response to the instability, major energy consumers are diversifying their supply chains. South Korean refiners have significantly increased imports of Canadian crude, a grade they had previously used only on a trial basis, according to a report from the Korea JoongAng Daily. Imports surged from 1.37 million barrels in 2024 to 4.54 million barrels last year.
This shift is driven by both necessity and economics. Landed Canadian crude cost $64.65 per barrel in 2025, roughly $10 cheaper than both U.S. and Saudi Arabian grades. "Korean refiners are actively bringing in Canadian crude as an alternative supply amid the current inability to secure Middle Eastern barrels," a government official told the newspaper. Refiners like HD Hyundai Oilbank are modifying infrastructure to handle the heavier, high-sulfur Canadian oil as they reduce their reliance on the Middle East.
This article is for informational purposes only and does not constitute investment advice.
