In the wake of the invasion of Iran by the US and Israel, international oil prices have surged past $90 per barrel, with domestic oil prices in South Korea also seeing double-digit increases. Such sustained price hikes raise fears of a renewed global inflation crisis and a retreat in the world economy. For South Korea, which heavily relies on Middle Eastern oil, the impact of elevated prices could be particularly severe.

Kuwait, producing about 2.6 million barrels of oil per day, has announced significant cuts to its oil production and refining capacity due to safety concerns related to Iranian threats in the Strait of Hormuz. The Kuwait Petroleum Corporation stated that this decision was a preventive measure in response to ongoing Iranian attacks and threats to maritime navigation in the strait. In light of its inability to fulfill oil supply contracts, Kuwait has reportedly invoked a 'force majeure' clause to avoid legal liability for contract defaults during wartime or disaster situations.

Additionally, the Abu Dhabi National Oil Company indicated that it is actively managing its offshore production, signaling possible production cuts. Other oil-producing nations, including Saudi Arabia and the UAE, are also expected to reduce output due to drone attacks and logistical challenges. These reductions in oil production are likely to further escalate international oil prices, with Brent crude futures seeing a notable increase in value. The fear of an energy crisis reoccurring in Europe, reminiscent of the situation during the Ukraine conflict, is also growing, with natural gas prices in London experiencing significant jumps as demand surges.