The energy agency warned shrinking inventories and strained refineries could further tighten markets.

The energy watchdog further cut its outlook for global oil demand, now expecting consumption to fall by 2.5 million barrels a day in 2026 compared with its previous forecast.

A spokesperson for the Jordanian Armed Forces said a barrage of “20 ballistic missiles” had been launched towards its territory as hostilities flare in the region.

Oil prices have shot past $100 a barrel as fighting between the U.S. and Iran escalates, threatening to increase costs for consumers and businesses worldwide.

The cost of shipping oil in the largest tankers hit record highs this week following the biggest wave of attacks on shipping since the U.S.-Iran war began

The U.S. military said it destroyed five Iranian oil tankers on Tuesday in response to the latest attacks on its warships and American targets in Jordan, the latest burst of back-and-forth strikes.

The U.S. destroyed three Iranian tankers three days earlier.

Iran threatened the United States with "economic warfare" on Tuesday and said it had fired an advanced missile at U.S. warships, underscoring the risks of further escalation in ​the war only days after both sides traded blows again.

Oil prices surged as Iran-backed Houthis seized control of Yemen's port city of Mokha on Thursday - an area vital to controlling shipping through the Red Sea.