Key facts
- Energy prices unlikely to return to pre-war levels by 2027.
- Middle East conflict has tightened energy markets.
- Oil prices are nearing $120 a barrel.
- Diesel and gasoil market crunch expected to extend into mid-2027.
Energy prices are unlikely to return to pre-war levels by 2027 due to the Middle East conflict, according to Fatih Birol, executive director of the International Energy Agency (IEA). Birol stated at the Singapore International Energy Week conference that the world faces a major energy security challenge as key global energy arteries come under pressure. He noted that high oil and fuel prices are significantly impacting trade deficits for many countries, particularly in Asia. The IEA expects the current crisis to accelerate the "Age of electricity" and nuclear power capacity expansions. Oil prices are currently flirting with $120 a barrel, with product prices even higher. The IEA's October Oil Market Report forecasts that the tightness in diesel and gasoil markets will extend into mid-2027, a view echoed by Morgan Stanley analysts who cited deferred refinery maintenance.