Brian Zinchuk is editor and owner of Pipeline Online
A black plume of smoke rises from a warehouse at the industrial area of Sharjah City in the United Arab Emirates following reports of Iranian strikes in Dubai, United Arab Emirates, Sunday, March 1, 2026. (AP Photo/Altaf Qadri)
It wasn’t lost on me that when I woke up uncharacteristically early on Saturday, the US and Israeli attack on Iran had begun. Yes, the timing might have been moved up because they knew where the Ayatollah was, with most of the leadership. But I also suspect it had something to do with oil prices.
For any attack on Iran would surely have an impact on oil prices around the world. And I think the Americans wanted to get some clear wins in before the markets opened on Monday. After all, their attack occurred after markets closed on Friday.
Maybe it was just coincidence. But maybe not.
I sit down to type this just a few minutes after the markets opened for Brent Crude across the pond. An immediate spike saw Brent go to around U$82 per barrel before coming down to US$76, then a slow rise to US$78.72. That’s from the previous week seeing the price hover around US$72 and closing at US$73.17.
West Texas Intermediate (WTI) shot up from Friday’s close of US$67.25 to US$74.77 then settled around US$72 per barrel as I finish writing this.
By the time I share this column on social media, Monday Morning, markets in North America will be just about opening. And that’s where the fun begins.
- 0113 Miller Epic Cinematic Hollywood trailer0113 Miller Epic Cinematic Hollywood trailer
- 0111 2026 SK Oil Show booth promo 010111 2026 SK Oil Show booth promo 01
- 0085 Turnbull snow removal call office0085 Turnbull snow removal call office
- 0110 SaskEnergy SEI_Network_Members_Burn_Brighter0110 SaskEnergy SEI_Network_Members_Burn_Brighter
- 0105 SaskEnergy Commitment to Safety0105 SaskEnergy Commitment to Safety
- 0102 Lori Carr Coal Extended0102 Lori Carr Coal Extended
- 0100 Turnbull Project Manager0100 Turnbull Project Manager
- 0099 Mryglod Steel 1080p0099 Mryglod Steel 1080p
- 0097 Eagle Sky Ventures LTD0097 Eagle Sky Ventures LTD
- 0095 Fast Trucking nearly 70 years good at it0095 Fast Trucking nearly 70 years good at it
- 0092 Turnbull projects big and small0092 Turnbull projects big and small
- 0046 City of Estevan This is Estevan Teaser0046 City of Estevan This is Estevan Teaser
- 0077 Caprice Resources Stand Up For Free Speech0077 Caprice Resources Stand Up For Free Speech
- 0061 SIMSA 2024 For Sask Buy Sask0061 SIMSA 2024 For Sask Buy Sask
- 0051 JML Hiring Pumpjack assembly0051 JML Hiring Pumpjack assembly
- 0049 Scotsburn Dental soft guitar0049 Scotsburn Dental soft guitar
- 0041 DEEP Since 2018 now we are going to build0041 DEEP Since 2018 now we are going to build
- 0032 IWS Summer hiring rock trailer music
- 0022 Grimes winter hiring
- 0021 OSY Rentals S8 Promo
- 0018 IWS Hiring Royal Summer
- 0013 Panther Drilling PO ad 03 top drive rigs
- 0002 gilliss casing services0002 gilliss casing services
- 9002 Pipeline Online 30 sec EBEX9002 Pipeline Online 30 sec EBEX
- 9001
There’s one fundamental truth I’ve learned in 17 years of writing about oil and gas: The difference of just two per cent of supply is the difference between a US$50 barrel and a US$100 barrel. The global oil market is now around 102 million barrels per day or so, according to the US Energy Information administration. It’s been around 100 million for several years now, ever so slowly increasing (so much for peak oil way predictions over a decade ago). When there’s a glut of about two million barrels per day, the price falls to around US$50, or lower. And indeed WTI was hitting the 50s in recent weeks. And when there’s a shortage – think Russia’s 2022 invasion of Ukraine – prices go over US$100 per barrel.
That’s a lot of price volatility for just a narrow band of prices – +/- 2 per cent. So what happens when 20 per cent of oil supply is suddenly at risk? Because as of Feb. 28, it is.
Somewhere around 20 per cent of global oil flows through the Strait of Hormuz. For decades, everyone has known Iran’s trump card, as it were, was to close the strait if it ever went to war with Israel and/or the US. It did try this in the 1980s, and we got the “Tanker War” and Operation Praying Mantis. That was where Reagan had had enough in 1988, and the US Navy wiped out a good chunk of the Iranian navy in a day.
Well, Trump said in his speech announcing the war that he was going to annihilate the Iranian Navy.
In its response to the overall assault, Iran has fired missiles at most of its neighbours. And they’re unlikely to take to kindly to it. That includes Kuwait, Bahrain, Qatar, United Arabe Emirates, Jordan and Israel. And a tanker has been hit off the coast of Oman in the Arabian Sea. Looking at MarineTraffic.com, as of Sunday evening, either all traffic through the Strait of Hormuz has stopped, or everyone’s turned off their transponders. It’s more like a bit of both.
You can consider the Strait of Hormuz closed for the foreseeable future.
- 0113 Miller Epic Cinematic Hollywood trailer0113 Miller Epic Cinematic Hollywood trailer
- 0111 2026 SK Oil Show booth promo 010111 2026 SK Oil Show booth promo 01
- 0085 Turnbull snow removal call office0085 Turnbull snow removal call office
- 0110 SaskEnergy SEI_Network_Members_Burn_Brighter0110 SaskEnergy SEI_Network_Members_Burn_Brighter
- 0105 SaskEnergy Commitment to Safety0105 SaskEnergy Commitment to Safety
- 0102 Lori Carr Coal Extended0102 Lori Carr Coal Extended
- 0100 Turnbull Project Manager0100 Turnbull Project Manager
- 0099 Mryglod Steel 1080p0099 Mryglod Steel 1080p
- 0097 Eagle Sky Ventures LTD0097 Eagle Sky Ventures LTD
- 0095 Fast Trucking nearly 70 years good at it0095 Fast Trucking nearly 70 years good at it
- 0092 Turnbull projects big and small0092 Turnbull projects big and small
- 0046 City of Estevan This is Estevan Teaser0046 City of Estevan This is Estevan Teaser
- 0077 Caprice Resources Stand Up For Free Speech0077 Caprice Resources Stand Up For Free Speech
- 0061 SIMSA 2024 For Sask Buy Sask0061 SIMSA 2024 For Sask Buy Sask
- 0051 JML Hiring Pumpjack assembly0051 JML Hiring Pumpjack assembly
- 0049 Scotsburn Dental soft guitar0049 Scotsburn Dental soft guitar
- 0041 DEEP Since 2018 now we are going to build0041 DEEP Since 2018 now we are going to build
- 0032 IWS Summer hiring rock trailer music
- 0022 Grimes winter hiring
- 0021 OSY Rentals S8 Promo
- 0018 IWS Hiring Royal Summer
- 0013 Panther Drilling PO ad 03 top drive rigs
- 0002 gilliss casing services0002 gilliss casing services
- 9002 Pipeline Online 30 sec EBEX9002 Pipeline Online 30 sec EBEX
- 9001
And therein likes the problem for world markets. Something like 20 per cent of world oil production travels through that straight. That includes all the production of Kuwait, Bahrain, Qatar, Iran itself, as well as most of Saudi Arabia’s and a good chunk of United Arab Emirates, although I’m not terribly sure on the last one.
Travelling eastward, countries like Pakistan, India, China and Japan are largely if not in some cases almost entirely dependent on that oil coming from the Persian Gulf. (Remember – Iran IS Persia.)
This is where you insert “Gee, I wish we had built Northern Gateway back in 2015” into the discussion.
While some of those countries may start turning to their strategic reserves in the meantime, every day that oil doesn’t flow will be brutal on those economies.
So what will this do to oil prices?
Much of North America doesn’t need oil from the Gulf. The US, when you factor in Canadian imports, is largely self-sufficient. Eastern Canada, on the other hand, is not. If the Energy East Pipeline had been completed, as scheduled, in December, 2018, we would have no concern either. But we all know what happened to that. So Eastern Canada still imports oil, including from the Gulf.
And if we had built Energy East by then, we could help support Europe in a small way. A million barrels per day or so wouldn’t replace anywhere near what they get from the Gulf, but it wouldn’t have been nothing.
- 0113 Miller Epic Cinematic Hollywood trailer0113 Miller Epic Cinematic Hollywood trailer
- 0111 2026 SK Oil Show booth promo 010111 2026 SK Oil Show booth promo 01
- 0085 Turnbull snow removal call office0085 Turnbull snow removal call office
- 0110 SaskEnergy SEI_Network_Members_Burn_Brighter0110 SaskEnergy SEI_Network_Members_Burn_Brighter
- 0105 SaskEnergy Commitment to Safety0105 SaskEnergy Commitment to Safety
- 0102 Lori Carr Coal Extended0102 Lori Carr Coal Extended
- 0100 Turnbull Project Manager0100 Turnbull Project Manager
- 0099 Mryglod Steel 1080p0099 Mryglod Steel 1080p
- 0097 Eagle Sky Ventures LTD0097 Eagle Sky Ventures LTD
- 0095 Fast Trucking nearly 70 years good at it0095 Fast Trucking nearly 70 years good at it
- 0092 Turnbull projects big and small0092 Turnbull projects big and small
- 0046 City of Estevan This is Estevan Teaser0046 City of Estevan This is Estevan Teaser
- 0077 Caprice Resources Stand Up For Free Speech0077 Caprice Resources Stand Up For Free Speech
- 0061 SIMSA 2024 For Sask Buy Sask0061 SIMSA 2024 For Sask Buy Sask
- 0051 JML Hiring Pumpjack assembly0051 JML Hiring Pumpjack assembly
- 0049 Scotsburn Dental soft guitar0049 Scotsburn Dental soft guitar
- 0041 DEEP Since 2018 now we are going to build0041 DEEP Since 2018 now we are going to build
- 0032 IWS Summer hiring rock trailer music
- 0022 Grimes winter hiring
- 0021 OSY Rentals S8 Promo
- 0018 IWS Hiring Royal Summer
- 0013 Panther Drilling PO ad 03 top drive rigs
- 0002 gilliss casing services0002 gilliss casing services
- 9002 Pipeline Online 30 sec EBEX9002 Pipeline Online 30 sec EBEX
- 9001
And on the topic of the East Coast, when then-German Chancellor Olaf Scholz came to Canada begging us to supply them with liquefied natural gas, then-Prime Minister Justin Trudeau took him to Newfoundland and promised hydrogen, electrolyzed from fresh water from an abandoned mine using new giant onshore wind turbines. (I kid you not). But since there was only one ship on the planet capable of shipping liquefied hydrogen, and a tiny one at that, it would have had to be turned into ammonia, first, before shipment.
A Canadian Press report Pipeline Online published just a few days ago pointed out Newfoundland and Labrador is chasing those wind folks for nonpayment of leases owed. We still haven’t shipped any ammonia, or hydrogen, to Germany, coming something like four years later.
There was “no business case” for LNG, Trudeau explained. So where did Scholze go next? To Qatar, and signed a multi-decade deal for Qatari LNG.
Except that now, all that Qatari LNG is going to be bottled up for the foreseeable future by the Iran War. Will current German Chancellor Friedrich Merz now beg Prime Minister Mark Carney for LNG? Or will they have learned their lesson by now? Canada is a waste of time?
And every other nation who signed onto Qatari supply finds their head in the same figurative noose, with Iran holding the trigger for the trap door.
So what will oil prices do? I filled up my F-150 this morning and gas prices were already up about 15 cents.
Here’s my guess: We’re going to see US$100 oil per barrel in short order. If this war goes on for a few weeks, expect US$150. If the Strait of Hormuz is closed shut, and stays that way for months, the sky’s the limit.
For Saskatchewan, we’re unfortunately just about to go into spring breakup. But I’m willing to bet some producers are making calls on Monday to see if they can get a rig in the field to add one more hole, maybe two, before breakup, just in case there’s a chance they can have production online in a few weeks to add just a wee bit more production and cash in.
There are 29 rigs drilling for oil in Saskatchewan Sunday night. Spring breakup usually starts around March 15. If that number goes up over the next week, you’ll have your answer.
Indeed, the whole oil and gas industry has to look at what they will be doing over the next days, weeks and months. What’s the right move?
So, ladies and gentlemen – place your bets!
Brian Zinchuk is editor and owner of Pipeline Online. He can be reached at brian.zinchuk@pipelineonline.ca.
- 0113 Miller Epic Cinematic Hollywood trailer0113 Miller Epic Cinematic Hollywood trailer
- 0111 2026 SK Oil Show booth promo 010111 2026 SK Oil Show booth promo 01
- 0085 Turnbull snow removal call office0085 Turnbull snow removal call office
- 0110 SaskEnergy SEI_Network_Members_Burn_Brighter0110 SaskEnergy SEI_Network_Members_Burn_Brighter
- 0105 SaskEnergy Commitment to Safety0105 SaskEnergy Commitment to Safety
- 0102 Lori Carr Coal Extended0102 Lori Carr Coal Extended
- 0100 Turnbull Project Manager0100 Turnbull Project Manager
- 0099 Mryglod Steel 1080p0099 Mryglod Steel 1080p
- 0097 Eagle Sky Ventures LTD0097 Eagle Sky Ventures LTD
- 0095 Fast Trucking nearly 70 years good at it0095 Fast Trucking nearly 70 years good at it
- 0092 Turnbull projects big and small0092 Turnbull projects big and small
- 0046 City of Estevan This is Estevan Teaser0046 City of Estevan This is Estevan Teaser
- 0077 Caprice Resources Stand Up For Free Speech0077 Caprice Resources Stand Up For Free Speech
- 0061 SIMSA 2024 For Sask Buy Sask0061 SIMSA 2024 For Sask Buy Sask
- 0051 JML Hiring Pumpjack assembly0051 JML Hiring Pumpjack assembly
- 0049 Scotsburn Dental soft guitar0049 Scotsburn Dental soft guitar
- 0041 DEEP Since 2018 now we are going to build0041 DEEP Since 2018 now we are going to build
- 0032 IWS Summer hiring rock trailer music
- 0022 Grimes winter hiring
- 0021 OSY Rentals S8 Promo
- 0018 IWS Hiring Royal Summer
- 0013 Panther Drilling PO ad 03 top drive rigs
- 0002 gilliss casing services0002 gilliss casing services
- 9002 Pipeline Online 30 sec EBEX9002 Pipeline Online 30 sec EBEX
- 9001