‘Fool’s solution’: Trump could make the energy disaster worse if he plays his last card

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It is hard to decide which is the bigger disaster: the unfolding car crash in the global gas market or the mounting danger that entire countries will run out of oil.

The benchmark TTF contract for gas in Europe was €29 ($47) per megawatt hour (MWh) in mid-February. Bank of America says it could reach €500 later this year if the Strait of Hormuz remains closed for 10 weeks, as it may well do.

That would blow through the record high seen after Russia’s invasion of Ukraine and amount to a full-blown economic emergency for Europe, Britain, Japan, South Korea and South Asia.

The picture is dramatically worse after Israel attacked Iran’s South Pars gas field, adding upstream gas and oil infrastructure to the menu of targets on both sides of the Gulf.

Iran’s missile retaliation on Qatar’s Ras Laffan has inflicted serious damage to the giant complex, which alone produces a fifth of the world’s liquefied natural gas (LNG).

‘Nobody knows’: Trump has left an old foe in the dark

Stephen BartholomeuszSenior business columnist

Senior business columnist

It will be months before shipments start again. Qatar Energy says 17 per cent of production is lost for three to five years. It will have to declare force majeure on LNG supplies to Italy, Korea, China and Belgium.

It is just as bad for oil. The paper market that we all follow does not capture the drama. Physical deliveries are under far greater stress than Brent futures (at about $US110) would suggest.

Actual barrels of the Dubai basket and Oman’s Murban are fetching close to $US170 ($240) a barrel as Asian refiners scramble to buy anything they can. Jet fuel deliveries have hit $US210 in Rotterdam and $US240 in Singapore.

Kurt Barrow, vice-president of oil at S&P Global Energy, says........

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