Direct military engagements between US and Iranian forces in the Strait of Hormuz have triggered a sharp spike in global oil prices. This escalation threatens critical energy transit choke points as Russia continues to tackle persistent domestic fuel deficits.
Global market
Brent crude oil futures surged 2.71% to $90.49 per barrel, while US WTI rose 2.47% to $85.46 per barrel on Monday. The price jump followed US military strikes on two Iranian rocket launchers on Larak Island in the Strait of Hormuz, triggering retaliatory attacks by Tehran against US bases in Jordan. Adding to the tension, US ex-President Donald Trump posted an AI-generated video showing strikes on Iran’s Kharg Island, a massive export hub with a capacity of 7 million barrels per day that handles over 90% of Iran’s oil exports. Amid these clashes, the US Army announced it will allocate $2.2 billion to its Janus program to deploy portable nuclear microreactors at military bases by 2028.
Russia & CIS
Fuel deliveries from Belarusian refineries to Russia are operating at maximum capacity to stabilize the domestic market, according to Kremlin Spokesperson Dmitry Peskov. These high-volume shipments aim to address ongoing logistics constraints, which the Russian Union of Industrialists and Entrepreneurs (RSPP) linked to a persistent domestic fuel deficit. Meanwhile, Russian manufacturer KMZ won a government tender to supply critical spare parts for diesel-generator sets at domestic nuclear power plants. On regional development, Russian Far East Development Minister Alexey Chekunkov outlined a three-pronged program to overcome severe energy deficits in eastern regions ahead of the Eastern Economic Forum (EEF).
Armenia
The military escalation between the US and Iran in the Persian Gulf introduces security risks for Armenia, which shares a southern land border with the Islamic Republic. In this context, Turkish President Recep Tayyip Erdogan and Russian President Vladimir Putin are scheduled to discuss regional energy security and Middle East tensions at their upcoming meeting in Bishkek.
Despite regional volatility, retail petrol, diesel, and natural gas prices in Armenia remained completely stable on August 31. The republic’s energy market continues to be insulated by its integration within the EAEU. Bilateral treaties with Moscow guarantee uninterrupted, duty-free imports of Russian gas and refined products at long-term fixed rates, shielding local consumers from the volatility of international market price assessments.