Oil and gas stocks jumped in morning trading. Cheniere rose 12%; Woodside Energy rose 10%; Apache rose 6%; TotalEnergies rose 5%; BP rose 4%; Occidental, Devon, and SLB rose 3%; Marathon Petroleum, ConocoPhillips, and Halliburton rose 2%; Chevron rose 1%.

The price of oil and natural gas jumped as escalating attacks in the Persian Gulf caused long-term damage to major energy facilities.

European gas futures surged as much as 35% to more than double their pre-war level. Brent crude touched $119 a barrel, close to its highest since 2022, and European diesel futures topped $190 a barrel at one point, underscoring the wider inflationary risks from the conflict.

An Iranian missile strike on the Ras Laffan complex in Qatar caused extensive damage to the world’s largest liquefied natural gas plant. Two facilities that produce 17% of the country’s LNG exports, or about 13 millions tons a year, were affected and it will take three to five years to repair them, QatarEnergy Chief Executive Officer Saad al-Kaabi told Reuters.

Separately, oil loadings on Saudi Arabia’s west coast, a vital export route for the country amid the closure of the Strait of Hormuz, were briefly halted by an attack. A gas facility in Abu Dhabi was shut after being hit by falling debris from an intercepted strike and two oil refineries in Kuwait were set ablaze by drones.

The attack on Qatar in particular raises the specter of long-term inflationary pressure in energy prices resulting from the US and Israel’s war on Iran. While oil and gas flows through the Strait of Hormuz could resume once the conflict ends, severe damage to any production facilities in the region will have a lasting impact on the global economy.