After an Israeli strike Wednesday on Iran’s portion of the South Pars gas field, which it shares with Qatar, Iran retaliated with attacks that caused “extensive damage” at Qatar’s Ras Laffan Industrial City, the world’s largest liquefied natural gas facility, officials said. The attacks sent the global oil benchmark soaring and prompted a scramble in Washington. President Donald Trump threatened “to blow up the entirety” of Iran’s South Pars gas holdings if Iran attacked Qatar again, and his treasury secretary said the United States would consider lifting sanctions on millions of barrels of Iranian oil.
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As the latest attacks rattled markets and the price of Brent crude, the global oil benchmark, briefly climbed past $119 per barrel before falling back to $108 on Thursday, Treasury Secretary Scott Bessent said the administration might lift restrictions on some 140 million barrels of Iranian oil that have already been loaded onto vessels — a week after lifting sanctions on Russian oil already in tankers.
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Although the attacks on energy infrastructure in recent days are a substantial escalation, they make up a fraction of the damage both sides could inflict, analysts say. Some are warning that if the attacks on oil and gas fields, liquefaction facilities and shipping terminals continue, the cost of a barrel of crude could spike to $150.
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Iranian drones in recent days have struck two refineries in Kuwait and one in Saudi Arabia, officials said. Iran also attacked the Saudi Red Sea port of Yanbu, from which the kingdom was exporting oil to avoid the Strait of Hormuz.Ask The Post AIDive deeper
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After Iran warned early Thursday that it would be attacking five specific Gulf state energy facilities, Rystad Energy warned that oil could quickly hit $120 a barrel and keep rising.
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Saraswat noted that Iranian strikes have yet to affect port loadings of fuel in Saudi Arabia, but that could change. If the port of Yanbu was substantially damaged, for example, that “could remove 5 to 6 million barrels per day from the market and potentially push oil prices to $150 or higher.”
I will add something that I heard in two parts from two different analysts: The first said that this attack has impaired Qatar's LNG production (I believe it was the process of turning the gas...
Iran retaliated with attacks that caused “extensive damage” at Qatar’s Ras Laffan Industrial City, the world’s largest liquefied natural gas facility, officials said.
I will add something that I heard in two parts from two different analysts:
The first said that this attack has impaired Qatar's LNG production (I believe it was the process of turning the gas into a liquid for transport) by 17% (a sizeable amount) and that this impairment will last 3-5 years (I presume the amount of time they were told it might take to fix).
The second said that LNG isn't a fungible resource the way that gasoline/diesel is and this is due to logistics and capacity (to ship as cargo), but also strategic stockpiling and production. The Middle East, particularly centered around the Strait of Hormuz, is not just the primary corridor for traffic, but also the world's primary producer (and the producer who will sell to almost anyone). Asia is more than just the primary buyer, they rely significantly on the LNG coming from the Middle East for their energy needs and they cannot quickly pivot away from it or find another source. There was one primary source and now it's output has been cut dramatically.
In the short-term we are already seeing the highly populated South Asia and Southeast Asia regions ration cooking fuel as well as some automotive fuels. I've read that coastal countries like Vietnam are not allowing pass-through sales to land-locked neighbors; the supply they buy they're keeping. I've read that people in Hong Kong are driving into mainland China to buy fuel due to cost and that will change political landscapes. A compounding effect will be when South Asia begins to see reduced fertilizer imports as this is the start of their import cycle for fertilizer.
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I will add something that I heard in two parts from two different analysts:
The first said that this attack has impaired Qatar's LNG production (I believe it was the process of turning the gas into a liquid for transport) by 17% (a sizeable amount) and that this impairment will last 3-5 years (I presume the amount of time they were told it might take to fix).
The second said that LNG isn't a fungible resource the way that gasoline/diesel is and this is due to logistics and capacity (to ship as cargo), but also strategic stockpiling and production. The Middle East, particularly centered around the Strait of Hormuz, is not just the primary corridor for traffic, but also the world's primary producer (and the producer who will sell to almost anyone). Asia is more than just the primary buyer, they rely significantly on the LNG coming from the Middle East for their energy needs and they cannot quickly pivot away from it or find another source. There was one primary source and now it's output has been cut dramatically.
In the short-term we are already seeing the highly populated South Asia and Southeast Asia regions ration cooking fuel as well as some automotive fuels. I've read that coastal countries like Vietnam are not allowing pass-through sales to land-locked neighbors; the supply they buy they're keeping. I've read that people in Hong Kong are driving into mainland China to buy fuel due to cost and that will change political landscapes. A compounding effect will be when South Asia begins to see reduced fertilizer imports as this is the start of their import cycle for fertilizer.