Global oil war: Energy becomes battlefield as Israel-Iran conflict escalates; war now in dangerous new phase
As Israel-Iran crisis enters its third week, it is becoming increasingly clear the war’s impact is not limited to region. With energy infrastructure under attack and supply chains at risk, the crisis has effectively become a global concern
PTC Web Desk: What began as a direct military confrontation between Israel, backed by the United States, and Iran has now taken a far more alarming turn. In just three weeks, the conflict has expanded beyond traditional warfare, with energy infrastructure emerging as a primary target.
The shift became evident in the past 24 hours when both nations struck facilities linked to oil and gas production. These developments have intensified fears of a prolonged crisis with global economic consequences, as energy supply chains come under direct threat.
Strike on South Pars signals turning point
A major escalation occurred when Israel targeted the South Pars gasfield, the world’s largest natural gas reserve. Until now, the US and Israel had avoided hitting Iran’s energy backbone, focusing instead on military installations, even during earlier strikes on Kharg Island, which handles a majority of Iran’s oil exports.
However, the attack on South Pars marked a clear departure from that restraint.
The importance of this gasfield cannot be overstated. It holds nearly 1,800 trillion cubic feet of natural gas, enough to meet global demand for over a decade. For Iran, it is even more critical, contributing to around 80% of the country’s electricity generation. The immediate spike in global oil and gas prices following the strike highlighted its strategic significance.
Shared resource complicates geopolitics
The situation is further complicated by the fact that South Pars is not solely Iran’s asset. It is shared with Qatar, where it is known as the North Field, a vital source of liquefied natural gas (LNG) exports worldwide.
Qatar, a key US ally, plays a crucial role in global energy supply, particularly for countries like India that depend heavily on LNG imports.
Iran expands retaliation across Gulf
In response, Iran broadened its retaliation beyond Israel. Missiles were launched toward Qatar’s Ras Laffan LNG facility, one of the largest in the world. Though the damage was limited, the move signaled a willingness to target regional energy hubs.
Further strikes were aimed at the UAE’s Habshan gas facility and the Bab oil field. While most missiles were intercepted, the attacks drew strong condemnation, with the UAE calling them a direct threat to global energy security.
Earlier, a drone strike had also disrupted operations at Abu Dhabi’s Shah gasfield, a key supplier of sulphur used in fertiliser production.
Iran has now warned of possible strikes on Saudi Arabia’s energy infrastructure, raising the stakes even higher.
Global energy supply under pressure
The widening scope of attacks has already begun to impact global markets. Brent crude prices surged to $110 per barrel, while gas prices climbed sharply. In the United States, gasoline prices reached their highest levels in months.
The disruption is particularly concerning because of the Gulf’s central role in global energy transit, especially through the Strait of Hormuz, a critical route for oil shipments to Asia and Europe.
Any prolonged instability in this region could severely strain global supply chains.
India faces potential supply shock
India, one of the largest importers of LNG, is especially vulnerable. A significant portion of its LPG and gas supply comes from Qatar and Saudi Arabia.
LNG is essential for fertiliser production and city gas distribution, including piped gas for households and CNG for vehicles. Any disruption could ripple across multiple sectors, impacting both industry and daily life.
Infrastructure damage could take years to repair
Experts warn that damage to energy infrastructure is not easily reversible. LNG facilities, in particular, are complex and time-consuming to restore.
This means the consequences of the current strikes could extend well beyond the immediate conflict, potentially affecting global energy markets for years.
Economic warfare takes centre stage
The recent pattern of attacks suggests a strategic shift. Rather than focusing solely on military targets, both sides are now using energy as a tool of economic pressure.
By targeting oil and gas facilities, the conflict is no longer confined to the battlefield, it is directly impacting global economies.