Meanwhile, Washington voted to let Operation Epic Fury continue indefinitely: File Image/Pixabay

The single biggest fear among oil analysts focused on the U.S./Iran war – that of global crude flows being disrupted – became a reality on Thursday with reports of China, Japan and India opting to conserve fuel.

This in turn led to a resumption of the climb in oil prices that began four sessions ago on the war's outbreak: Brent gained about $3 to settle at around $84 per barrel, while West Texas Intermediate traded as high as $78.

China prioritized domestic needs and ordered its refiners to suspend gasoline and diesel exports; in Japan, refiners requested that supply be released from strategic petroleum reserves, and this came on the heels of India earlier telling customers it would halt product exports.

Compounding the issue was the ongoing blockage of the Strait of Hormuz: despite London insurers offering coverage, shippers still opted to avoid the route and possible Iranian military strikes.

Consequently, Middle Eastern oil futures on Thursday soared, as did Brent’s prompt spread.

The analytical consensus on Thursday was that prices had nowhere to go but up, and dramatically: “If we see even one more successful strike on an oil tanker or infrastructure, or sustained disruption, prices can spike sharply again,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.

ING analysts pointed out that, “A mere 10 percent rise in oil prices can deteriorate current account balances [for emerging markets] by 40 to 60 basis points; prolonged increases would only deepen these deficits,” and they added that Thailand, South Korea, Vietnam, Taiwan and Philippines are most vulnerable.

Goldman Sachs estimated that an increase in Brent from $70 to $85 would add roughly 0.7 percentage points to inflation across emerging Asia and reduce economic growth by about 0.5 points.

As for the war itself, CENTCOM commander admiral Brad Cooper told the Pentagon that Iran has attacked 12 countries so far since Operation Epic Fury was launched by the U.S. and Israel, “And I look forward to working with all the partners who are willing to join us in this.”

Also, a bipartisan effort to curb U.S. president Donald Trump’s authority to further prosecute the war was rejected on Thursday  by the House of Representatives, meaning Operation Epic Fury will continue indefinitely.