G7 nations to hold emergency meeting on oil as stock markets sink

G7 nations will hold an emergency meeting today (9 March) to discuss surging oil prices as crude jumped above $100 a barrel and global stock markets slumped amid the escalating US-Israeli war with Iran, BBC reports.

According to the BBC report, finance ministers from leading industrialised countries, including UK Chancellor Rachel Reeves, are set to gather to discuss the economic impact of the conflict.

Global oil prices rose sharply, reaching nearly $120 a barrel amid fears of prolonged disruption to energy supplies through the key Strait of Hormuz shipping route, while the UK's FTSE 100 share index fell 1.5%, BBC reports.

The BBC report, citing the Financial Times, said the G7 meeting will also discuss a possible joint release of petroleum reserves coordinated by the International Energy Agency (IEA).

If IEA members release reserves, it would be the first such move since 2022, when action was taken after Russia's full-scale invasion of Ukraine, the BBC report added.

Major disruption to energy supplies from the region threatens to push up prices for consumers and businesses worldwide, while rising inflation could also reduce the likelihood of interest rate cuts by central banks, BBC reports.

About a fifth of the world's oil supply usually passes through the Strait of Hormuz, but traffic through the narrow passage has nearly halted since the war began more than a week ago, the BBC report said.

According to the BBC, Iran on Sunday named Mojtaba Khamenei as successor to his father Ali Khamenei as Supreme Leader, signalling that hardliners remain in charge more than a week into the conflict.

The BBC report said the US and Israel launched fresh waves of airstrikes across Iran over the weekend, targeting multiple sites including oil depots.

Meanwhile, Iran targeted energy infrastructure in neighbouring Gulf states, while Saudi Arabia said it intercepted and destroyed two waves of drones heading towards a major oilfield overnight, BBC reports.

On Monday morning in Asia, Brent crude jumped more than 25% to reach $119.50 a barrel before falling back to around $107, while US West Texas Intermediate (WTI) crude traded at about $104 a barrel, the BBC report said.

Gas prices also surged, with UK gas prices for month-ahead delivery rising nearly 25% to 171p a therm when trading opened on Monday before easing to around 156p a therm, BBC reports.

European stock markets opened lower following steep declines earlier in Asia, with Germany's Dax and France's Cac 40 both falling by about 2.5%, according to the BBC report.

In London, nearly all shares in the FTSE 100 fell, though oil giants BP and Shell were among the few companies to register gains, the BBC report added.

Earlier, Japan's Nikkei 225 index dropped 5.2%, while South Korea's Kospi index closed down 6%. Trading on the Kospi was halted for 20 minutes at one point by a circuit breaker designed to curb panic selling, BBC reports.

Adnan Mazarei of the Peterson Institute for International Economics told the BBC the surge in oil prices was expected as production had halted in some Gulf countries and signs pointed to a prolonged conflict, adding that people are realising it will not end quickly and that US assurances and objectives are becoming more unrealistic, the BBC report said.

US President Donald Trump, who campaigned on lowering the cost of living, has repeatedly dismissed concerns about rising oil prices, BBC reports.

On Sunday he wrote on his Truth Social platform: "Short term oil prices, which will drop rapidly when the destruction of the Iran nuclear threat is over, is a very small price to pay for U.S.A., and World, Safety and Peace. ONLY FOOLS WOULD THINK DIFFERENTLY!"

Meanwhile, US Energy Secretary Chris Wright told American broadcasters that Israel, not the US, was targeting Iran's energy infrastructure, amid concerns about rising domestic fuel prices caused by the war, the BBC report said.

Data from motorists group AAA showed the average price for regular gasoline in the US rose 11% last week to $3.32 a gallon, according to the BBC report.