Oil prices surged on Thursday as intensifying attacks on energy infrastructure across the Middle East raised concerns about potential supply disruptions linked to the widening U.S.–Israel conflict with Iran. The latest developments have expanded worries beyond the Strait of Hormuz, highlighting broader risks to global energy supply networks.
Brent crude futures jumped 8.4% to $116.35 per barrel by 05:07 ET (09:07 GMT), while U.S. West Texas Intermediate crude futures rose 1.4% to $97.64 per barrel, briefly touching $100.02 during trading.
The rally was also supported by a Reuters report indicating that the United States was considering deploying thousands of troops to the Middle East, fueling speculation over the scale and consequences of a possible ground operation involving Iran.
Jefferies analysts expect tensions to remain elevated in the coming weeks, though they believe both sides may attempt to expose each other’s strategic weak points before eventually moving toward negotiations from a stronger position.
“A realistic scenario would be that the US puts boots on the ground to take over the Kharg island and force Iran into negotiations,” Jefferies’ Mohit Kumar said in a note.
Oil extends rally after strikes on energy assets
Crude prices continued their sharp advance from the previous session after reports indicated that Israel had struck facilities at Iran’s South Pars field — the world’s largest natural gas field.
Iran responded with attacks on energy installations in Qatar, the United Arab Emirates and Saudi Arabia.
Tehran had previously warned that it could target several major energy facilities in the region, including Saudi Arabia’s SAMREF and Jubail complexes, the United Arab Emirates’ Al Hisn gas field and Qatar’s Ras Laffan refinery.
U.S. President Donald Trump said in a strongly worded post on social media that Washington had not been informed about Israel’s strike on South Pars and warned Iran against carrying out further retaliatory actions.
Trump added that Israel would not strike South Pars again and warned that the United States would “massively blow up” the gas field if Iran responded with additional retaliation.
Supply disruption fears remain elevated
The possibility of further attacks on oil and gas infrastructure across the Middle East has intensified concerns about supply disruptions linked to the Iran conflict, particularly as Tehran continues to keep the Strait of Hormuz — a vital corridor for global oil shipments — largely closed.
Reuters reported late Wednesday that the Trump administration was considering sending thousands of troops to the region, with one potential objective being to safeguard tanker traffic through the Strait of Hormuz.
The report also said Washington was evaluating the option of deploying forces to Iran’s Kharg Island after military targets near the oil export hub were struck last week.
“With the US–Iran confrontation now in its third week, there is still no credible path to de‐escalation. Vessel traffic through the Strait of Hormuz remains severely restricted,” OCBC analysts said in a note.
“Prolonged shipping paralysis is forcing Gulf producers into output shut‐ins, heightening the risk that temporary disruptions evolve into more persistent supply losses.”
Oil prices climbed despite the strength of the U.S. dollar and growing concerns that rising energy costs could push central banks toward a more hawkish stance. The Federal Reserve on Wednesday highlighted uncertainty surrounding energy-driven inflation, while U.S. producer price data also came in above expectations.
Crude markets also brushed aside figures showing an unexpected weekly increase in U.S. oil inventories.
Earlier this week, the oil rally briefly paused after reports that Iraqi and Kurdish authorities had agreed to resume crude flows through Turkey’s Ceyhan export terminal. Major economies were also reported to be considering releasing crude from emergency reserves to help offset supply disruptions tied to the Iran conflict.
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