The joint military action by the United States and Israel against Iran on Saturday, February 28, has sent shockwaves through global energy markets.
By the close of trading on Friday, February 27, the Brent crude oil benchmark had already risen to $72.87 per barrel. Analysts at Mirae Asset Sharekhan noted that this price included a geopolitical risk premium of $4 to $6 due to tensions with Iran. Over the weekend, oil futures traded on decentralized platforms surged by more than 5% following news of the attacks.
The situation could deteriorate further. The Iranian Revolutionary Guard issued a radio warning to ships in the Strait of Hormuz, declaring, "No vessel is allowed to pass." Although Iran has not officially confirmed a blockade, the announcement alone has raised alarm bells. This narrow waterway between Iran and Oman sees approximately 20 million barrels of oil pass through daily, accounting for 20% of global crude oil consumption and a fifth of the world's liquefied natural gas.
Swiss bank Lombard Odier predicts that a prolonged blockade could spike oil prices to over $100 per barrel, while some cryptocurrency traders are anticipating scenarios where prices could soar to between $120 and $150 if a full closure occurs. According to David Roche, a strategist at Quantum Strategy, if the conflict extends into a three to five-week regime change operation, as suggested by Trump, it could lead to severe market reactions.
OilPrice.com analysts agree that a substantial "war premium" will be factored into crude oil prices when Asian markets reopen on Sunday night. Additionally, there's an expected shift towards safe-haven assets, such as an increase in the dollar and gold prices, alongside a potential 1% to 2% drop in global stock markets, as reported by CNBC.
Beyond controlling the Strait of Hormuz, Iran is the fourth-largest producer in OPEC and exports between 1.5 and 1.9 million barrels daily, primarily to China. According to Axios, the markets will closely watch for any damage to the Jarg Island terminal, through which most of Iran's oil exports are shipped. Indeed, RSM data indicates that exports from Jarg tripled in the second half of February, reaching 3 million barrels daily, seemingly as part of an Iranian strategy to maximize sales ahead of the anticipated conflict.
The Dire Impact on Cuba: Outages, Hunger, and Crisis
For Cuba, already enduring its worst energy crisis since the "Special Period" of the 1990s, the escalation in the Middle East is another blow to a crumbling economy.
The island requires about 110,000 barrels of oil daily to function but only produces around 40,000. Following the downfall of Maduro and the halt of Venezuelan oil supplies, along with Washington's blockade on crude shipments to Cuba, the island has stopped receiving imported oil. Even Mexico, under U.S. pressure, ceased its shipments. President Díaz-Canel acknowledged that Cuba hasn't received a single barrel of foreign oil so far in 2026.
The consequences are already devastating. According to Cuba's own Electrical Union, blackouts are simultaneously leaving up to 64% of the island without power, with outages lasting up to 20 hours. Eight of the 16 thermoelectric units are out of commission, and distributed generation—which used to supply 40% of electricity—has been halted since January due to a lack of fuel. A Bloomberg analysis using satellite images reveals that nighttime illumination in eastern provinces like Santiago de Cuba and Holguín has decreased by 50%. The workweek has been reduced to four days, universities have shifted to virtual learning, airlines like Air Canada have suspended flights to the island, and Germany has advised against all non-essential travel.
Ripple Effects of Rising Oil Prices for Cuba
An oil price of $100 or more carries several direct implications for Cuba:
1. Increased Costs for Energy Rescues: Should Russia or any other nation attempt to send oil to Cuba against Washington's pressures, the cost per barrel would be significantly higher. While China approved $80 million in aid and rice, it hasn't sent oil. Russia promised crude, but shipments have yet to materialize. Every dollar increase in oil prices makes any rescue operation more challenging and costly. Ironically, a U.S. government report revealed that Cuba resold 60% of the oil it received from Venezuela, sending about 40,000 barrels daily to Asia while its population endured power outages.
2. Impact on Remittances: A surge in oil prices fuels global inflation, reducing the purchasing power of the Cuban diaspora and subsequently decreasing the volume of remittances to the island—one of its few sources of foreign currency.
3. Further Decline in Tourism: Cuba already experienced a more than 40% drop in arrivals from the U.S. in January 2026, according to data analyzed by CiberCuba. With flights canceled due to a lack of kerosene, hotels closing, and a war potentially raising global airfare due to increased aviation fuel costs, the 2026 tourist season is virtually doomed.
4. Weakening of the Dictatorship's Allies: Iran is a crucial geopolitical ally of the Cuban regime. With Venezuela already fallen, if the Iranian regime totters or collapses, Cuba loses another pillar in its network of alliances, which includes Russia—bogged down in Ukraine—and China, offering symbolic aid but not oil. As analyzed by CiberCuba, with each ally the Cuban regime loses, it becomes more isolated. Meanwhile, even the UN has called for a humanitarian exception to send oil to Cuba, underscoring the extreme severity of the situation.
What Lies Ahead?
Everything hinges on the conflict's duration and the status of the Strait of Hormuz. If the attacks are brief and the strait remains open, markets might stabilize quickly, akin to the Twelve-Day War in June 2025. However, if the operation extends for weeks—as Pentagon sources suggested to CNBC—and the strait is effectively closed, the world could face the most severe oil crisis in decades.
For the 11 million Cubans who already cook with wood, light their homes with candles, and wait in line for hours to get gasoline, the war with Iran isn't a distant conflict. It's another turn of the screw in a crisis that has already pushed them to their limits.
This is a developing story. Information will be updated as new data about the markets and the conflict becomes available.
Impact of Rising Oil Prices on Global Markets and Cuba
How might the closure of the Strait of Hormuz impact global oil prices?
A prolonged closure of the Strait of Hormuz could push global oil prices above $100 per barrel, with some scenarios predicting prices between $120 and $150.
What are the potential consequences of high oil prices for Cuba?
High oil prices could exacerbate Cuba's energy crisis, increase costs for potential oil imports, reduce remittance flows, and further damage the tourism sector.
What role does Iran play in global oil exports?
Iran is the fourth-largest producer in OPEC and exports between 1.5 and 1.9 million barrels of oil daily, mainly to China.