The war between the United States, Israel, and Iran has driven up the world's oil, fuel, and LNG import bill by as much as $330 billion over six months, according to the Centre for Research on Energy and Clean Air. Europe, China, and India absorbed the biggest hits, and refining damage plus elevated LNG prices could keep import costs high even after the fighting stops.
The war between the United States, Israel, and Iran has swelled the world's oil, fuel, and LNG import bill by as much as $330 billion over the six months from March to August, a new analysis shows. That is despite a smaller-than-feared rise in oil and gas prices. The war is not over, so the bill could still grow.
Data for the estimate comes from the Finland-based think tank Centre for Research on Energy and Clean Air (CREA), which compares actual import spending to what analysts had forecast before the war. CREA called the Persian Gulf disruption the biggest since the 1990 Gulf War, with the European Union hit hardest of all.
Crude and fuels make up most of the tab
Crude oil made up the largest share of the total, at $164.1 billion. Diesel and gasoil added another $73.8 billion. Gasoline contributed $35.7 billion of the total. LNG cost importers an extra $38 billion. Jet fuel added $20 billion more than forecast.
Europe, China and India absorb the biggest hits
The European Union felt the sharpest pain, paying $78 billion more than expected, a result of its reliance on U.S. crude and LNG after sanctioning Russian hydrocarbons. China, the world's biggest crude and LNG importer, paid an extra $35 billion, even as it cut imports. It drew down stockpiles estimated at between 1 billion and 1.4 billion barrels at the start of the year. India, even more dependent on oil and gas imports than the EU, paid $22 billion more after Iran's closure of the Strait of Hormuz disrupted export flows from the Middle East, on which it especially relies.
Refining damage could keep the pain going
Asian LNG prices averaged some 75% higher than pre-war expectations over the six months. European LNG prices ran 60% higher. Both regions still need to restock for winter, which could push prices up further. The International Energy Agency estimated as much as a fifth of Middle East refining capacity has been knocked out by the fighting. That amounts to some 9.6 million barrels a day. Ukrainian drone strikes have added damage to Russian refineries on top of that.
Wind, solar, and other low-carbon sources saved importers $36 billion over the same period, CREA said. That offset is real, but it does not erase the bigger bill.
Source: Centre for Research on Energy and Clean Air (CREA)
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