Qatar warns that oil could double to $150 a barrel and ‘bring down the economies of the world’
Qatar’s energy minister has warned the price of a barrel of oil could surge to more than $150 – dragging down global economies.
Saad al-Kaabi says the Middle East conflict could result in a new energy crisis.
The comments came as the price of crude soared around 7 per cent to over $90 a barrel having spent most of the year around the $60-$70 a barrel mark.
A rise to $150 would see it more than double from where it was before the attacks on Iran.
Mr Kaabi told the Financial Times that such a rise will ‘bring down the economies of the world’.
He added: ‘If this war continues for a few weeks, GDP growth around the world will be impacted. Everybody’s energy price is going to go higher.
‘There will be shortages of some products and there will be a chain reaction of factories that cannot supply.’
He warns Gulf energy exporters could shut down production, and that in turn would drive the price of oil up.
He told the FT that even if the war does end soon, it is likely to take weeks or months for production cycles to return to normal.
That comes after an Iran drone strike hit its largest liquefied natural gas plant earlier in the week.
Oil is on track for its biggest weekly gain since 2022, as conflict in the Middle East disrupts markets and adds to fears of a fresh bout of inflation.
The price of Brent crude has risen by nearly 30 per cent this week.
It followed a brief retreat on Thursday after the US signalled its intention to curb surging prices with measures that include allowing the Treasury to trade oil futures.
The Middle East conflict has sent energy markets into a tailspin, as Iran effectively shut the key shipping route the Strait of Hormuz.
Economists have warned a prolonged spike in oil and gas prices could add to inflation and push central banks to tighten policy.
Already, petrol prices in Britain have been nudging higher and energy firms have pulled many fixed tariffs for households – with warnings the Ofgem set price cap will rise sharply in July, if the conflict continues.
That comes after gas prices spiked on Monday and Tuesday.
Qatar is the second largest producer of LNG. Not a huge amount of Qatar gas is exported to Europe, but Mr Kaabi warns that Asian buyers will look to buy whatever gas is available.
This in turn will drive up prices.
Mr Kaabi told the FT that he expects more Gulf countries to call force majeure in the coming days.
Joshua Mahony, chief market analyst at Scope Markets, said: ‘Oil prices have continued to rise, as we head towards the biggest weekly gain in four years as hopes of a swift resolution in Iran fade.
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