Following an Israeli strike on Iran’s portion of the South Pars gas field, Iranian forces carried out retaliatory attacks on energy infrastructure in neighboring Gulf states, officials said, in a development described as a “dangerous escalation” that pushed oil prices higher.
Iran ordered evacuations at energy installations in Qatar, Saudi Arabia and the United Arab Emirates, saying those facilities had become “direct and legitimate targets,” according to semi-official Mehr News Agency. The Islamic Revolutionary Guard Corps warned local rulers they had been repeatedly cautioned against “gambling with the fate of their nations.”
Qatar and the UAE sharply criticized Israel’s initial strike. Qatar’s foreign minister called the attack a “dangerous and irresponsible step,” while Qatar’s Foreign Ministry also condemned Iran’s subsequent strikes as a violation of sovereignty and a further dangerous escalation. Among the Iranian strikes, forces hit the Ras Laffan liquefied natural gas terminal in Qatar — the most serious attack on Qatari energy infrastructure since the war began — and QatarEnergy reported fires and “extensive damage.”
Former U.S. President Donald Trump posted that neither the United States nor Qatar had been aware Israel would strike the South Pars field and urged Israel not to repeat such an attack unless Iran again targeted Qatar’s LNG facilities. He warned that if Iran attacked Qatar’s LNG again, the U.S. would respond and “massively blow up” the South Pars field, while saying he did not want to authorize such destruction because of long-term consequences for Iran.
Saudi Arabian and Emirati energy sites were later struck by missiles and drones, the Saudi Ministry of Defense and the UAE Foreign Ministry said. The UAE described the attacks as a terrorist act that threatened regional stability and global energy security.
Iran’s declared targets focused on facilities that produce refined products — gasoline, diesel and jet fuel — rather than crude oil. Kpler analyst Matt Smith noted the potential targets could affect more than 1.25 million barrels per day of regional refining capacity; global refining capacity was about 103.5 million barrels per day in 2023. While that would amount to roughly 1% of global refining capacity, analysts warned disruptions could still lift fuel prices and have outsized effects on consumers. Patrick De Haan of GasBuddy said strikes on refining and production facilities can influence pump prices more than comparable crude disruptions, and Smith called the attacks an “upping of the ante” after the targeting of Iranian gas infrastructure.
Markets reacted quickly: U.S. crude rose nearly 3% to about $99 per barrel and global benchmarks climbed roughly 5% to around $108 per barrel. The situation was exacerbated by a near-closure of the Strait of Hormuz, a key transit route for roughly 20% of the world’s oil, which further tightened an already constrained global supply.