G7 finance ministers will meet later in the day to discuss the impact of the war on Iran, Germany’s finance ministry said on Monday.
Oil prices rose to near US$120 per barrel as the Iran war intensified, threatening production and shipping in the Middle East and jolting financial markets.
The price of Brent crude, the international benchmark, rose to $119.50 per barrel earlier in the day but later gained $14 to trade near $106 per barrel before the opening hour.
West Texas Intermediate, the lightest, sweetest crude oil produced in the United States, rose above $119.48 per barrel but settled closer to $103.
The war toll on civilian targets increased as Bahrain accused Iran of striking a desalination plant vital to its drinking water supply.
Bahrain’s national oil company declared force majeure for its shipments after an Iranian attack burned down its refinery complex. A legal declaration releases the company from contractual obligations due to extraordinary circumstances.
Oil depots in Tehran went up in smoke after Israel’s overnight strike.
As the war, now in its second week, oil prices have soared, trapping countries and places critical to the production and movement of oil and gas from the Persian Gulf.
Prices moderated after the Financial Times reported that some members of the Group of Seven industrialized nations were considering releases of strategic oil reserves to ease pressure on markets.
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French President Emmanuel Macron said on Monday that “the use of strategic reserves is a planned option”. He said G7 leaders could meet this week to coordinate a response to rising energy prices.
France currently holds the rotating presidency of the G7 group. Separately, finance ministers from the G7 nations are meeting via video conference on Monday to discuss the implications of the war.
On Saturday, US President Donald Trump played down the idea of tapping into America’s Strategic Petroleum Reserve, saying US supplies were plentiful and prices would soon fall.
Roughly 15 million barrels of crude oil — about 20 percent of the world’s oil — are typically shipped through the Strait of Hormuz every day, according to independent research firm Ristad Energy. The threat of Iranian missile and drone attacks has stopped tankers carrying oil and gas from Saudi Arabia, Kuwait, Iraq, Qatar, Bahrain, the United Arab Emirates and Iran traveling through the strait, which borders Iran to the north.
Iraq, Kuwait and the UAE have cut oil production as storage tanks fill up due to reduced capacity to export crude oil. Iran, Israel and the United States have also attacked oil and gas facilities since the war began, worsening supply concerns.
A surge in oil and natural gas costs is driving up fuel prices, cascading through other industries and weighing on Asian economies that are particularly vulnerable because of the region’s heavy reliance on imports from the Middle East.
Iran exports roughly 1.6 million barrels of oil a day, mostly to China, which has called for an immediate end to the fighting. Beijing may have to look elsewhere for supplies if Iran’s exports are disrupted, another factor pushing up energy prices.
“All parties have their responsibilities to ensure stable and smooth energy supply,” Chinese Foreign Ministry spokesman Guo Jiakun said at a briefing on Monday.
“China will take necessary measures to safeguard its own energy security.”
South Korean President Lee Jae-myung on Monday warned of stiffer penalties for refineries and gas stations, saying it would be wise to find alternatives for supplies that must travel through the Strait of Hormuz.
Across Southeast Asia, rising prices have led to long lines outside filling stations.
“High oil and gas prices affect everyone and our economy,” said Le Van Tu, waiting outside a gas station in the Vietnamese capital Hanoi.
“All activities will be affected, including using petrol-based transport.”
South Korea’s Kospi fell 6 percent to 5,251.87.
Brent and US crude futures last traded near current levels in 2022 after Russia invaded Ukraine.
Higher energy costs increase inflation, strain household budgets and reduce consumer spending, which is a key driver of many large economies. Those worries spilled over into financial markets, with stock prices sharply lower.
In Canada, according to the CAA, the national gas price was at C$1.54 as of publication early Monday and was around C$1.32 a week ago.
In the US, the average price of a gallon of regular gasoline rose to US$3.48 early Monday, up about 50 cents from a week earlier, according to the AAA Motor Club.
Diesel, which is used heavily in shipping, sold for about $4.66 a gallon, an increase of more than 80 cents for the week.
Natural gas prices in the US rose during the war, although not as much as oil. It was selling for about $3.34 per 1,000 cubic feet early Monday. That’s up from Friday’s closing price of $3.19.
– With files from Reuters and Global’s Ariel Rabinovitch
© 2026 The Canadian Press
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