By Faisal Islam

Economics editor BBC

Last week, the markets had been relatively relaxed about the seeming nightmare scenario for millions of barrels of crude and liquefied gas to be trapped in the Gulf, with tankers unable or unwilling to transit the Strait of Hormuz.

But the escalations over the weekend, alongside scenes of destruction of energy infrastructure both in Iran and across the Gulf, saw the markets take rapid fright.

The question now is where does this go? Some analysts argue that if the shutdown in the Strait lasts until the end of March, record oil prices above $150 a barrel could occur.

The existing rise is likely to further increase petrol prices, and important derivative products such as jet fuel and vital precursors for fertilisers.

The physical supplies from the Gulf are mainly consumed in Asia. Already, however, there are signs that Asian consumers are bidding up prices for US gas, with some tankers originally heading for Europe turning around in the mid Atlantic.