Iran Conflict Latest Developments: Attacks on Energy Infrastructure Spark Concerns, Oil Price Volatility

Investing.com - On Friday, oil prices remained high, with little sign of market concerns about potential supply disruptions caused by a war with Iran easing.

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Brent crude futures recently hovered around $108 per barrel. Earlier this week, after Israel attacked a key natural gas field in Iran and Tehran retaliated against Middle Eastern gas facilities, the global benchmark oil price surged to about $119 per barrel.

Mutual bombings targeting major energy infrastructure have heightened fears that, even if the U.S. and its allies successfully reopen the vital Strait of Hormuz in southern Iran, supply disruptions could persist for a long time.

Qatar’s main natural gas facility, Ras Laffan, was attacked by Iran, which said its export capacity has decreased by 17%, with repairs potentially taking up to five years. The country is a major natural gas exporter, especially to Europe, and the European gas benchmark prices have already soared, raising concerns about inflation spikes.

On Friday, The New York Times reported that Iran continues retaliatory attacks, with Middle Eastern countries allied with the U.S. saying they are facing incoming drones and missiles. The paper added that missile alerts sounded overnight in Jerusalem and northern Israel, prompting Israel to strike Tehran.

According to a statement cited by The Wall Street Journal, Iran’s Supreme Leader Ayatollah Ali Khamenei said, “We must take security away from our domestic and foreign enemies and give it to our people.” This provocative message was issued by Khamenei, son of the late leader Ali Khamenei, amid Israel’s systematic targeting of Iranian regime officials in an attempt to topple the government.

Israeli Prime Minister Benjamin Netanyahu confirmed that U.S. President Donald Trump has asked Israel to delay future attacks on Iran’s energy infrastructure.

The White House has been working to calm market fears of a prolonged oil price shock, with U.S. Treasury Secretary Janet Yellen indicating that Washington may release more emergency oil reserves or even lift sanctions on some Iranian oil exports to help ease supply constraints.

According to The Wall Street Journal, citing U.S. military officials, Washington and its allies are also ramping up efforts to reopen the Strait of Hormuz. If the risk of attacks on ships passing through the strait can be reduced, U.S. warships might be able to escort vessels in and out of the Persian Gulf, one of the world’s most important energy-producing regions.

Analysts at Vital Knowledge stated in a report: “The key remains the Strait of Hormuz. Without a sharp escalation of war (involving thousands of troops) or a diplomatic resolution, there is no fully reopened solution for the waterway, and timing is critical.” They emphasized that Saudi Arabia warned that if the conflict does not end before April, oil prices could rise above $180 per barrel.

However, some analysts note that even if Iran’s control over the strait is lifted, attacks on production facilities could continue to pressure global supplies.

Trump vowed to take all necessary measures to help ease the crisis and tried to reassure Americans that “it will be over soon.”

He also stated there are no plans to deploy ground troops to the battlefield, but when asked about the possibility of deploying land combat forces, Trump told a reporter, “If I do that, I won’t tell you.”

Meanwhile, the Pentagon announced it has requested $200 billion in war funding from the White House, highlighting the costs of this controversial campaign that has divided American public opinion.

(This is an evolving story. Please check back for updates.)

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