Iran attacked an oil refinery in Kuwait and Israel killed a spokesman for Iran’s Revolutionary Guards as the conflict between the two nations, involving the United States, showed no signs of abating. The benchmark price of Brent crude oil eased slightly to US$108 after surging the day before amid fears of major disruptions to world energy supplies.
Escalating Conflict and Energy Concerns
Israel promised to avoid further attacks on Iran’s South Pars gas field following an Iranian retaliatory strike on Qatar, which is expected to cause a long-term shortage of natural gas. The conflict is unfolding as Muslims observe Eid al-Fitr and Iranians mark Nowruz, the Persian New Year.
Flows of crude and petroleum have dropped by approximately 12 million barrels a day, representing about 12% of global demand. The International Energy Agency estimates restoring oil and gas flows could take up to six months.
International Response and US Involvement
US President Donald Trump repeated calls for major US allies to help secure shipping safety, including Germany, Britain, Italy, France, the Netherlands, Japan, and Canada, who pledged to join “appropriate efforts” to ensure safe passage through the Strait of Hormuz. However, Germany indicated this presupposes an end to combat.
French President Emmanuel Macron stated that defending international law and promoting de-escalation was the primary focus, adding that there was no expressed willingness to enter the conflict.
Kuwait’s state oil firm reported multiple drone attacks on its Mina al-Ahmadi refinery, setting some units alight. The US Energy Secretary Chris Wright suggested that some Asian customers could receive supplies within days if the US removed sanctions on Iranian oil currently at sea.
Diverging Goals and Potential Troop Deployments
Prospects for a truce are complicated by differing objectives between Israel and the US. US director of national intelligence Tulsi Gabbard said the Israeli government is focused on disabling Iranian leadership, while President Trump aims to destroy Iran’s ballistic missile capabilities and navy.
Israeli Prime Minister Benjamin Netanyahu promised to heed Trump’s instruction regarding the gas field attack, but also claimed Iran is now unable to enrich uranium or produce ballistic missiles. However, Iran’s Revolutionary Guards maintain missile production is ongoing.
The conflict has resulted in thousands of deaths and millions displaced, particularly in Iran and Lebanon, where Israel has attacked Iranian-backed Hezbollah. It is also impacting Israel’s political landscape and creating risks for Trump’s Gulf Arab allies.
Netanyahu suggested overthrowing Iran’s government would require a “ground component.” Reports indicate the US is considering deploying thousands more troops to the Middle East, potentially including landings on Iranian shores or Kharg Island. Trump stated he would “do whatever is necessary” but did not confirm troop deployments.
Soaring US diesel and petrol prices could negatively impact Trump’s political support, while the war itself is unpopular with voters, and a potential ground operation even more so, as Republicans prepare for midterm elections.
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