CommBank analysis said the Middle East conflict has disrupted global energy markets, with about 20% of global oil supply and LNG trade typically transiting the Strait of Hormuz. Head of Commodities Vivek Dhar said markets may be underpricing the risk if the conflict lasts months rather than weeks, given limited spare capacity and potential physical shortages. The report said LNG and natural gas markets are exposed following shutdowns of LNG facilities in Qatar, and it flagged rising fertiliser prices including urea as a potential driver of higher global food prices. Head of Foreign Exchange and Geoeconomics Joseph Capurso said higher energy prices could revive inflation risks and force tougher central bank trade-offs, particularly in import-dependent economies such as Japan and China. For Australia, Head of Australian Economics Belinda Allen said the main near-term channel is higher petrol prices lifting headline inflation, while any national income boost from higher energy export prices may be muted due to foreign ownership.

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