Oil prices have remained surprisingly muted despite escalating conflict in the Middle East, with Brent crude hovering around $85 a barrel even as Strait of Hormuz shipping has been disrupted and key energy facilities attacked. The market's restrained reaction stands in stark contrast to worst-case scenarios predicted by energy experts before the US and Israel began bombing Iran.

Energy infrastructure across the Gulf has suffered significant damage, including the shutdown of Qatar's world's largest LNG plant and a major Saudi oil refinery. More than 150 tankers now wait outside Hormuz as insurers balk at sending vessels through active conflict zones. Yet crude remains well below the $128 peak reached after Russia's 2022 invasion of Ukraine, with prices rising only 30 percent since fighting began.

Market veterans attribute the calm to several factors: developed economies' reduced oil intensity since the 1970s, the US becoming the world's largest producer, and traders' experience managing recent crises including COVID-19 and Russia's Ukraine invasion. The oil industry has become adept at rerouting tankers and building strategic stockpiles. Some analysts predict prices could exceed $100 if the strait remains blocked for two weeks, forcing Gulf producers to shut down fields when storage fills.