Brent crude oil prices rose above $111 per barrel on Tuesday before falling to around $109, as the International Energy Agency (IEA) warned that the global energy crisis could persist into 2027.

The price increase followed growing concerns that renewed conflict between the United States and Iran could disrupt oil production and shipments from the Middle East, threatening global supply.

IEA Executive Director Fatih Birol said a return to normal conditions in the energy market next year was unlikely, citing ongoing geopolitical tensions and the risk of further disruptions to major oil transportation routes.

Speaking at an industry gathering in London, Birol warned that the Strait of Hormuz could be closed again, threatening a key route that handled about one-fifth of global oil and natural gas supplies before the conflict.

Tensions in the region have increased following threats of renewed hostilities between Iran and the United States. Saudi Arabia has also faced attacks by Iran-backed Houthi militants, raising concerns about the security of oil shipments.

Despite these risks, regional oil flows have remained strong. Data from energy analytics firm Kpler showed that the seven-day average of oil shipments through the Strait of Hormuz, the Red Sea and the Gulf of Oman rose to just over 24 million barrels per day as of Tuesday, exceeding pre-war levels.

The recovery of Saudi Arabia’s pipeline exports has helped sustain supplies, although tanker movements through the Strait of Hormuz remain significantly below pre-war levels.

Birol said the impact of the crisis extended beyond crude oil prices, warning that refined petroleum products had experienced even sharper increases.

He noted that diesel prices had doubled compared with pre-war levels, partly due to the conflict involving Iran and attacks on Russian refineries.

The IEA chief warned that diesel supply could come under further pressure as seasonal demand increases and several major refineries undergo scheduled maintenance.

He also said the agency’s member countries could consider releasing additional emergency oil reserves if supply conditions deteriorate.

In March, member countries agreed to release 400 million barrels from their emergency stocks to ease market pressures. About 80 per cent of the volume had been supplied to the market, while the remaining 20 per cent was yet to be released.

Birol said member countries still held approximately 1.6 billion barrels in reserves, which could provide additional support if the crisis worsens.