Oil Prices Soar to $118 a Barrel as US-Iran War Escalates in the Gulf

The global oil benchmark surged to $118 per barrel on Wednesday after Israel bombed Iran’s South Pars gas field — the largest known natural gas reserve in the world — setting off devastating fires at refinery and petrochemical facilities. Within hours, Iran’s Revolutionary Guard Corps retaliated by striking energy infrastructure across the Persian Gulf. Iranian missiles caused extensive damage to Qatar’s Ras Laffan facility, which handles nearly a fifth of all global liquefied natural gas exports, whilst separate attacks damaged refineries in Kuwait, oil fields in the United Arab Emirates and a Saudi Aramco terminal at the Red Sea port of Yanbu. The escalation has rattled global markets, grounding shipping through the Strait of Hormuz, through which roughly 20 per cent of the world’s oil and LNG normally flows. Energy analysts are warning that sustained disruptions could reignite inflation across Europe and Asia. The United States insisted it had no advance knowledge of the Israeli strike on South Pars, though officials confirmed to multiple outlets that Washington had coordinated and approved it. President Trump vowed to ‘massively blow up’ the entire field should Iran attack Qatar again, even as he urged a halt to further Israeli strikes. Japan has begun releasing strategic oil reserves, while the International Maritime Organization has proposed a safe maritime corridor to evacuate roughly 20,000 seafarers stranded across the Gulf.