Araghchi warns of 'devastating' impact on gas markets from any Israeli adventure

Key Facts

Iranian Foreign Minister Abbas Araghchi warned that any military adventure initiated by Israel in the Gulf region could have a 'devastating' impact on international markets, saying it remained a source of concern for gas suppliers and consumers. The warning came in a post on X in which Araghchi referred to discussions at the Gas Exporting Countries Forum summit in Moscow. The statement puts gas supply security at the center of concerns about a renewed escalation, as shipping in the Gulf and the Strait of Hormuz remains disrupted. Araghchi did not attach figures on prices or markets to his remarks. In its summit declaration, the forum also expressed concern about the impact of geopolitical developments, particularly in the Middle East, on gas market stability, supply security, investment risks and price volatility.

The Strait of Hormuz is central to these concerns: about one-fifth of global oil and liquefied natural gas supplies passed through it before the war, according to Aaj English TV. The channel said Gulf energy shipments had been severely disrupted since the war began and Iran started restricting passage through the strait. It added that Iran had regularly attacked vessels attempting to cross without authorization, while the United States maintained a separate naval blockade of Iranian ports. Trade traffic thus faces restrictions from both sides in a corridor that carried a large share of global energy supplies. These developments do not, in themselves, mean that oil or gas prices have moved in a particular direction.

In a development underscoring the risks to shipping, Iran said 7 oil tankers caught fire or were damaged in the strait during the night of 22 October 2026. The Associated Press reported Iran's account, noting that it could not independently verify it. The agency said October saw the highest number of reported attacks on commercial vessels since March, in the first weeks of the war. The British maritime operations monitor noted that some shipping companies were reluctant to report incidents, making maritime security harder to track. These events highlight the scale of the threat facing vessels, while the number of reported attacks continues to depend on reports reaching the relevant authorities.

With regular routes disrupted, tankers are using a passage near the coast of Oman protected by U.S. forces, sailing at night with their positioning systems switched off, according to an Associated Press analysis of oil movements. After crossing the passage, the tankers transfer crude to other vessels waiting in the Gulf of Oman to ship it to customers in Asia. The agency said the voyages were costly in time, money and sailors' lives. As another alternative route, Saudi Aramco chief Amin Nasser said oil flows through the kingdom's east-west pipeline, which bypasses the Strait of Hormuz, had risen from 2 million barrels to 7 million barrels a day. Nasser described the increase as threefold, pointing to the expanded use of the pipeline to cope with the disruption to energy traffic through the strait.

Shipping risks intersect with a negotiating track whose terms remain disputed. Iran's envoy to Pakistan said Tehran had told Islamabad it was ready to reopen the Strait of Hormuz if Washington lifted its naval blockade, and accused the United States of undermining diplomatic efforts. He also said Iran remained open to talks with the United States under an interim agreement brokered by Pakistan. According to the Associated Press, Iran is proposing to fully open the strait within a week if Washington meets its conditions, including ending the blockade of Iranian ports. The report said President Donald Trump rejected the proposal in the previous month, while indirect discussions continued.

Regional mediators are continuing efforts to bring Washington and Tehran back to formal talks, according to the Associated Press. Araghchi said on Wednesday that Tehran remained open to diplomacy but was ready to defend itself. By contrast, Aaj cited the Wall Street Journal as saying Washington had told Gulf states it was prepared for the possibility of a short, intense military campaign against Iran after the U.S. midterm elections scheduled for 3 November 2026. The report attributed to people briefed on the discussions the account that Trump had made no final decision. In Israel, votes were still being counted on Wednesday, and no clear winner had emerged between Benjamin Netanyahu's camp and the opposition led by Gadi Eisenkot. Against the backdrop of tensions, the International Monetary Fund projected global economic growth of 3.1% in 2026 and 3.4% in 2027, with global inflation at 4.7% and then 4.1%; it also projected Iran's gross domestic product would contract 5.4% and consumer prices would rise 68.9% in 2026.