Economic Context for Businesses
Wednesday, 11 March 2026
Recent developments in the Middle East have created significant volatility in global energy markets. Since tensions escalated in late February, investors and businesses have been assessing whether disruptions in the region could materially affect global oil supply and transport costs.
Energy markets are particularly sensitive to developments around the Strait of Hormuz, a key shipping corridor through which roughly one-fifth of global oil supply normally passes. Any sustained disruption to shipping through this route could have wider implications for global energy prices.
Global Energy Market Developments
Reports from RTÉ and BBC News indicate that oil markets have experienced sharp movements during the past week.
- Price Volatility: Brent crude briefly surged above $110 per barrel earlier this week, reaching levels not seen since 2022, before falling sharply and later stabilising around the $90 range as markets assessed supply conditions and potential policy responses.
- Supply Concerns: Concerns about disruptions across parts of the Gulf region have added to market uncertainty. Reports referenced infrastructure incidents, including a refinery shutdown in Abu Dhabi following a drone strike, raising concerns about regional supply stability.
- Policy Response: G7 officials and the International Energy Agency (IEA) have discussed the possibility of a coordinated release of strategic oil reserves to help stabilise global markets. Similar measures were taken during the 2022 energy crisis.
Impact on the Irish Economy
Higher global energy prices are already being reflected in fuel and heating costs across Ireland.
- Retail Fuel: Petrol and diesel prices have risen sharply at many service stations, with diesel exceeding €2 per litre at some forecourts.
- Home Heating: The cost of home heating oil has also increased significantly, with reports indicating that a 500-litre fill reached approximately €880 earlier this week.
- Transport and Logistics: Rising fuel costs are placing pressure on supply chains. Shipping company Maersk has indicated that higher transport and fuel costs are already being passed on to customers and consumers.
- Haulage Update: The Irish Road Haulage Association (IRHA) has suspended its planned national protest this week to enter emergency talks with the Government. The association is seeking immediate relief from the carbon tax and M50 tolls to offset unsustainable fuel hikes.
Economic Outlook
The key economic question is whether current price increases represent a short-term disruption or a more sustained supply shock.
If energy prices remain elevated for an extended period, this could contribute to higher inflation and influence central bank policy decisions later in the year. However, financial markets continue to assess whether supply conditions will stabilise through reserve releases or increased production elsewhere.
At ECOVIS Ireland, we continue to monitor these developments and their potential implications for Irish businesses, particularly in relation to operating costs, inflation pressures and cash flow planning.
Sources: links to news articles for further information:
- RTÉ News (11 March): Oil shrugs potential IEA reserves release, gains on supply worries
- RTÉ News (9 March): Home heating oil reaches €880 for 500 litres
- BBC News (11 March): Iran war cost will be passed to consumers – Maersk boss
- BBC News (9 March): G7 nations to hold emergency meeting on oil markets
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