Kharg Island – through which 90% of Iran’s oil exports flow – remains a strategically vital, yet untouched, target in the ongoing conflict, raising concerns about potential global economic repercussions should it be attacked.
The modest island in the Persian Gulf, located 27 miles from the Iranian mainland, has so far been spared from the US-Israel bombing campaign despite being arguably the country’s most sensitive economic target. Experts suggest a strike on Kharg Island could trigger a significant surge in already elevated oil prices, potentially destabilizing global energy markets.
According to analysis from Chatham House, attacking or capturing the site could push oil prices to $150 a barrel, exceeding the $120 peak seen earlier this week. “It’s too vital for global energy markets,” said Neil Quilliam. The fear of Iranian retaliation has already effectively closed the Strait of Hormuz to tanker traffic, driving prices nearly $20 higher per barrel.
Kharg Island’s unique infrastructure, featuring long jetties that allow supertankers access to deep water, makes it a crucial export terminal for Iranian crude oil, fertilizers, liquid gas, and other products. The island has served as a trade hub for centuries, but became a key oil terminal in the mid-20th century, capable of loading ten supertankers simultaneously.
While the US has conducted over 5,000 strikes in and around Iran, it has refrained from targeting the country’s oil infrastructure. Although, Israel did strike two oil refineries and two depots on Saturday, causing widespread disruption and darkness in Tehran. No further attacks on oil facilities have been reported since then.
The decision over Kharg Island appears to be a strategic calculation between striking, seizing, or leaving the site untouched, with Israel reportedly showing greater willingness to target Iranian oil and fuel assets. The development underscores the delicate balance between disrupting Iran’s economy and avoiding a wider escalation of the conflict with potentially devastating global consequences.
