Global Oil Prices Surge as Israel–Iran Conflict Hits Key Energy Infrastructure

Global oil prices have surged sharply following an Israeli strike on Iran’s South Pars gasfield, escalating tensions in the ongoing United States–Israel conflict with Tehran and raising fears of prolonged disruption to global energy supplies.

According to a report by Al Jazeera, Brent crude the international oil benchmark climbed by more than 5 percent to $108.66 per barrel, while US West Texas Intermediate (WTI) rose to $98.65. The widening gap between the two benchmarks reflects growing concerns over supply instability amid intensifying hostilities.

The spike came after Iranian state media confirmed that facilities linked to the South Pars gasfield — the world’s largest natural gas reserve located off Iran’s southern coast — were struck. The attack marks a significant escalation, as energy infrastructure becomes a direct target in the conflict.

In response, Iran’s Revolutionary Guard threatened retaliatory strikes against oil and gas installations across key Gulf states, including Qatar, Saudi Arabia and the United Arab Emirates. Hours later, Qatari authorities reported a fire at the Ras Laffan gas facility following a missile strike, though officials said the situation was eventually brought under control.

The widening conflict has already begun to disrupt energy exports across the Middle East, a region responsible for a significant share of global oil and liquefied natural gas supply. Analysts warn that continued attacks could sustain high energy prices and trigger a fresh wave of global inflationary Critical shipping routes have also been affected. Fighting has slowed or halted shipments through the Strait of Hormuz a strategic chokepoint through which roughly 20 percent of global oil and gas supplies pass intensifying fears of a broader supply shock.

Production losses in the region are estimated between 7 million and 10 million barrels per day, representing up to 10 percent of global demand.

In response to the crisis, the United States announced a temporary 60-day waiver of the Jones Act to allow foreign vessels to transport fuel and essential goods between US ports. Washington also issued a general licence permitting certain transactions involving Venezuela’s state oil company, PDVSA, in a move aimed at easing supply constraints.

Meanwhile, Iraq has resumed oil exports via pipeline after reaching an agreement between Baghdad and the Kurdistan Regional Government, offering a limited offset to broader regional supply disruptions.

Experts caution that if the conflict persists and energy infrastructure continues to be targeted, the global economy could face sustained inflationary pressure and heightened market volatility