Middle East Energy Crisis: Infrastructure Strikes Trigger $110 Brent Spike

Market snapshot: The global energy market entered a period of extreme volatility on March 18, 2026, as coordinated and retaliatory strikes targeted critical infrastructure across the Persian Gulf. Brent crude surged over 7% to hit $110.94/bbl following reports of an ongoing attack on Bahrain's newly modernized Sitra refinery and LNG terminal. This follows a drone strike near Iraq's Umm Qasr port, threatening the region's only deep-water export hub. Geopolitical risk premiums have now reached multi-year highs as the conflict expands to upstream assets in the UAE and Iran's South Pars gas field.

Summary: Escalating regional conflict in the Middle East has targeted oil and gas infrastructure in Bahrain, Iraq, and Iran, pushing Brent crude to $110.94 and threatening India's LNG and crude supply chains.

Key Takeaways

• Brent crude has risen 54.82% over the last 30 days due to the closure of the Strait of Hormuz and infrastructure damage.
• Bahrain's Sitra refinery (400k bpd) is under force majeure following repeated drone strikes.
• India's energy security is at risk; West Asia accounts for 48.7% of India's crude and 68.4% of its LNG imports.

SAHI Perspective

For Indian markets, the immediate concern is the twin deficit. With crude above $110, the landed cost for Indian refiners like IOCL and BPCL will spike, likely leading to retail fuel price revisions. The disruption in LNG supply from Qatar and the UAE will force industries in the ceramics and fertilizer sectors (Gujarat-based) to seek expensive spot-market alternatives, impacting margins in Q1 FY27.

Closing Insight

As the conflict moves into its third week, energy-heavy portfolios should prepare for high-beta volatility. The shift from 'fear-based' pricing to 'supply-squeeze' pricing suggests a new floor for Brent near $100.

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