Global oil prices jumped sharply on Wednesday after an Israeli strike targeted Iran’s massive South Pars gas field, escalating fears of prolonged disruption to energy supplies amid the ongoing US-Israeli war with Iran.
Brent crude, the international benchmark, rose more than 5% to $108.66 per barrel, while US West Texas Intermediate (WTI) crude climbed 2.5% to $98.65 per barrel. The discount between WTI and Brent widened to its largest level since May 2019.
Iranian state media reported that the attack hit natural gas facilities linked to the South Pars field — the world’s largest gas field, located offshore in Bushehr province. In retaliation, Iran’s Revolutionary Guard threatened to target oil and gas infrastructure in Qatar, Saudi Arabia, and the United Arab Emirates.
Later on Wednesday, Qatari authorities confirmed a fire at the Ras Laffan gas facility following an Iranian ballistic missile attack, though the Interior Ministry said the blaze was later brought under control.
The conflict has severely disrupted oil and gas exports from the Middle East. Fighting has effectively halted most shipments through the Strait of Hormuz, a critical chokepoint that carries about 20% of global oil and liquefied natural gas supplies. Analysts estimate that total oil output cuts in the region now range between 7 million and 10 million barrels per day — equivalent to 7–10% of global demand.
Experts warn that if the disruptions persist, the global economy could face a new wave of inflation driven by sustained high energy prices.
In response to the crisis, the Trump administration announced a 60-day waiver of the Jones Act, temporarily allowing foreign-flagged vessels to transport fuel, fertiliser, and other goods between US ports. The US Treasury Department also issued a general licence authorising certain transactions involving Venezuela’s state oil company, PDVSA.
In Iraq, exports via pipeline resumed after Baghdad and the Kurdistan Regional Government reached an agreement on Tuesday. Officials indicated that Iraq aims to pump at least 100,000 barrels per day through the port.
The sharp rise in oil prices reflects growing anxiety over the widening conflict and its potential to cause long-term damage to global energy markets. Markets are expected to remain volatile in the coming days as developments in the Middle East unfold.
