The Daily Aus Will the Middle East conflict drive up prices?
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Mar 3, 2026 They discuss recent US and Israeli strikes on Iran and the cascade of regional retaliations. They explain how disruptions in the Strait of Hormuz and tanker attacks could reroute shipping and push oil prices higher. They outline petrol price timing at Australian pumps, warnings about panic buying, and why the central bank is closely monitoring inflation and interest rate risks.
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Strait Of Hormuz Is A Critical Oil Chokepoint
- Global oil flows rely heavily on the 33-kilometre Strait of Hormuz which carries about 20–25% of the world’s oil and LNG daily.
- Disruptions there force tankers to reroute around the Cape of Good Hope, adding thousands of kilometres and delaying shipments.
Shipping Firms Are Avoiding The Strait Right Now
- Iran declared the Strait of Hormuz 'practically closed' after strikes and several tankers were hit, prompting shipping companies to avoid the route.
- Hundreds of tankers anchored outside the strait and major firms warned they will reroute, tightening near-term supply.
Oil Prices Jumped Sharply After The Strikes
- Global oil prices jumped about 8–13% in one trading day, moving from roughly US$67 to about US$79 a barrel.
- That short-term spike reflects market reactions to supply risk rather than instant changes at the pump in Australia.