IEA's heavy warning: Over 40 energy assets in the Middle East severely damaged! Global supply chain may face prolonged disruptions.

The Executive Director of the International Energy Agency (IEA), Fatih Birol, stated that more than 40 energy assets in nine countries in the Middle East have suffered "serious or very serious damage" due to war, and this may prolong disruptions in the global supply chain after the conflict ends. Birol mentioned that the damages mean that oil fields, refineries, and pipelines will take some time to resume operations. The conflict in the Middle East, which has lasted for more than three weeks, has disrupted the entire energy supply chain, with the crucial Strait of Hormuz almost closed, leading to a surge in prices of crude oil, natural gas, and fuel. Birol stated that the impact of the current disruptions is equivalent to combining the two major oil crises of the 1970s and the natural gas crisis following Russia's invasion of Ukraine in 2022. Birol said, "Not only oil and gas, but also some vital arteries of the global economysuch as petrochemical products, fertilizer, sulfur, and heliumtheir trade has been interrupted, which will have serious consequences for the global economy." The International Energy Agency announced in early March that it would release a record 400 million barrels of oil from its emergency oil reserves to help alleviate supply shocks and curb the surge in oil prices triggered by the Middle East war. Last week, the agency also proposed a series of measures to help energy-importing countries reduce their demand. Birol stated that if the Middle East conflict further disrupts the global energy market in the coming days to weeks, more oil reserves can be released as needed. However, he pointed out that the only way to truly resolve the fuel supply disruptions is to reopen the key TRADELINK route of the Strait of Hormuz. Trump's "final ultimatum" escalates war concerns As the Middle East conflict enters its fourth week, it has shattered the hopes of Wall Street and ordinary people that this conflictand the almost complete halt of transportation through the Strait of Hormuzwould be measured in days rather than weeks or months. Due to the escalating conflict between the US and Iran, shipping through the Strait of Hormuz is currently at a standstill, with more than 150 oil tankers and cargo ships forced to anchor outside the strait. JPMorgan warned that the closure of the strait is not just a temporary disruption, but a structural shock that could lead to a global economic standstill. Scenario analysis from Deutsche Bank shows that if the blockade leads to substantial damage to energy infrastructure, oil prices soaring to $200 per barrel would shift from theoretical speculation to reality. A Bank of America Securities director also warned that if the blockade of the Strait of Hormuz continues for months, the global economy will inevitably slide into a deep recession, with Brent and WTI oil prices likely to soar above $200 per barrel. Ray Dalio, the founder of Bridgewater Associates, stated on March 16 that the conflict between the US, Israel, and Iran will escalate decisively around the Strait of Hormuz. The outcome of this will affect more than just oil prices; it will determine whether the US-led global order can survive. Dalio wrote in a lengthy post on the X platform, "It all depends on who controls the Strait of Hormuz." He believes that if Iran still has the capability to control the strait and even negotiate who can pass through it, then regardless of how the conflict is resolved, the US will be seen as having lost the war. As a focus of the current conflict, both the US and Iran are showing great concern over the Strait of Hormuz. It is reported that the US military is currently deploying additional troops to the Middle East, with the aim of focusing on the Strait of Hormuz. Three US warships, including the USS Boxer amphibious assault ship, and about 2,500 sailors and marines have set sail from San Diego, California to the Middle East. Prior to this, the US Department of Defense had dispatched the amphibious assault ship USS Tripoli from Japan to transport the 31st Marine Expeditionary Unit to the Middle East. It was revealed that this deployment will provide US President Trump with more military options, including launching operations to "clear" the Strait of Hormuz, which would require deploying air and naval forces to the Iranian coast. In addition, the Trump administration is also considering deploying ground forces to the Iranian oil export lifeline of Khark Island, with the aim of capturing the island as leverage to force Iran to restore passage through the Strait of Hormuz. In response to the US military's plan to take Khark Island, sources from the Iranian military have stated that if the US launches "military aggression" against the island, it will face an "unprecedented retaliation" since the US attacked Iran. Furthermore, Trump issued a 48-hour final ultimatum to Iran on Saturday night, demanding the reopening of the Strait of Hormuz, or else face strikes on its power plants. Iran responded by stating that any such attacks would prompt it to indefinitely close the waterway and strike at US and Israeli energy infrastructure in the region, indicating that both sides have the risk of escalating the conflict. It is worth noting that the deadline given by the US to Iran will expire today. As the deadline approaches, the focus of attention will not only be on whether Iran will further allow ships through, but also on whether the US will escalate its confrontations over passage rights into direct strikes on Iran's critical infrastructure. Reports indicate that the Trump administration has begun discussions on possible negotiations with Iran and their conditions, including the reopening of the Strait of Hormuz and long-term arrangements on the Iran nuclear and missile issues. In this regard, the "48-hour" final ultimatum not only serves as a deterrent but also sets the tone and threshold for future negotiations. However, since the US and Iran still have no direct contact, with significant differences in the conditions conveyed through third parties, the more accurate description at present should be "applying pressure while preparing," rather than a shift towards negotiations. Goldman Sachs significantly raises 2026 oil price forecast As transportation through the Strait of Hormuz faces prolonged interruptions and concerns over structural risks related to the concentration of global supply intensify, Goldman Sachs has raised its 2026 oil price forecast. In their latest outlook, the bank now assumes that oil shipments through this critical waterway will operate at only 5% of normal levels for an extended period of six weeks. This represents a more severe and prolonged disruption scenario than previously expected. Goldman further predicts that the restoration of transportation will require an additional month, indicating that supply recovery will be gradual rather than immediate. Goldman analysts stated that this revised scenario reflects a reassessment of geopolitical risks in the region, with ongoing conflicts increasing the likelihood of long-term supply disruptions. The Strait of Hormuz is a vital artery of the global energy market, and even a partial disruption could have a significant impact on prices. In addition to short-term disruptions, Goldman also emphasized more long-term structural changes in the oil market. The bank pointed out that the high degree of concentration in global production and idle capacity (mainly limited to a few countries) may give rise to a more sustained risk premium in oil prices. Analysts indicated that this dynamic is expected to prompt governments and market participants to increase their strategic stockpiling efforts, thereby exerting upward pressure on future oil prices. Based on these changes, Goldman has raised its 2026 Brent crude average price forecast from $77 per barrel to $85. The bank has also increased its 2026 WTI crude average price forecast from $72 per barrel to $79. This adjustment highlights how geopolitical tension is not only affecting short-term price fluctuations but also beginning to reshape long-term expectations for supply security and pricing dynamics. Goldman analysts pointed out that even if transportation returns to normal, given the vulnerabilities exposed by recent disruptions, the market may maintain a higher structural risk premium.