Economic Consequences of the Power Vacuum in Iran: Analysis of Energy Sector Disruption Following the February 2026 Leadership Decapitation

The coordinated United States-Israeli military operations against Iran on February 28, 2026, designated Operation Epic Fury and Operation Roaring Lion, precipitated the most significant disruption to global energy markets in decades. The assassination of Supreme Leader Ali Khamenei created an unprecedented power vacuum in one of the world's major petroleum-producing nations, threatening the stability of approximately 20% of global oil transit through the Strait of Hormuz. This study employs a current events research methodology to analyze the immediate and projected economic consequences of the crisis, with particular focus on oil and liquefied natural gas (LNG) market disruption, the de facto closure of the Strait of Hormuz, China-Iran energy relations, and the internal dynamics of control over Iran's energy sector during the leadership transition. Drawing on historical precedents from Libya (2011) and Iraq (2003), we assess fragmentation risks and their implications for international energy security. Our analysis indicates Brent crude surged 13% to $82.37 per barrel while European natural gas prices increased 41-45%, with potential for sustained prices exceeding $100 per barrel under prolonged conflict scenarios. The findings underscore the acute vulnerability of global energy supply chains to geopolitical disruption in the Persian Gulf region.