Iran launched a wave of drone and missile strikes against energy infrastructure across the Persian Gulf on Monday, forcing Saudi Aramco to shut down its massive Ras Tanura refinery and prompting QatarEnergy to halt all liquefied natural gas production, in a dramatic escalation of retaliatory attacks following the United States and Israel joint military campaign that killed Supreme Leader Ayatollah Ali Khamenei on February 28. The attacks on the energy sector represent a calculated shift in Iranian strategy from targeting military installations to striking the economic lifeline of Gulf states that host American forces, threatening to plunge global energy markets into their worst crisis since the 2022 disruptions.
Saudi Arabia's defense ministry confirmed that Shahed-136 drones struck Saudi Aramco's Ras Tanura refinery, the kingdom's largest oil refining facility on the Persian Gulf coast with a capacity of 550,000 barrels per day. Two drones were intercepted over the facility, but falling debris ignited a limited fire that prompted a precautionary shutdown of the entire complex. No injuries were reported and Saudi officials described the fire as controlled, but the closure of one of the world's most critical refining installations sent shockwaves through energy markets. Saudi Arabia denounced the strikes as treacherous and vowed a swift and overwhelming military response.
Qatar's Ministry of Defense confirmed that two Iranian drones targeted the country's energy facilities, with one striking a water tank at a power plant in Mesaieed Industrial City and another hitting an energy facility in Ras Laffan Industrial City belonging to QatarEnergy. The state energy company subsequently announced a complete halt to all LNG production and associated products. The suspension carries enormous global implications because QatarEnergy's Ras Laffan complex, which operates 14 LNG trains with 77 million tonnes of annual capacity, accounts for approximately one-fifth of the world's entire LNG supply. Approximately 20 people were injured across Qatar from the broader Iranian attacks, though no deaths were reported from the energy facility strikes specifically.
The Strait of Hormuz, through which roughly 20 percent of global petroleum consumption passes daily, has experienced a de facto closure even though Iran has not declared a formal blockade. The Islamic Revolutionary Guard Corps transmitted radio warnings to vessels that no ship would be permitted to pass, and ship-tracking data showed a 70 percent reduction in traffic through the chokepoint. Major shipping companies including Maersk, MSC, Hapag-Lloyd and CMA CGM all suspended transits, while marine insurers canceled war risk policies for vessels in Iranian waters and the Gulf. At least three tankers were attacked near the strait, including the Palau-flagged vessel Skylight, which was struck five nautical miles north of Khasab, Oman, injuring four crew members before all 20 aboard were evacuated.
Energy markets reacted with the sharpest price movements in years. Brent crude surged approximately 10 percent to over 82 dollars per barrel on Monday, with Barclays raising its forecast to 100 dollars and UBS warning prices could exceed 120 dollars if supply disruptions continue. European natural gas prices experienced an even more dramatic spike, with the Dutch TTF benchmark soaring as much as 49 percent to 47.65 euros per megawatt-hour, the sharpest daily jump since August 2023. Goldman Sachs warned that if Strait of Hormuz LNG flows are fully halted for one month, European gas prices could reach 74 euros per megawatt-hour, which is 130 percent above pre-crisis levels. The timing is particularly dangerous because European Union gas storage stands below 30 percent capacity, compared to 40 percent at the same point last year.
OPEC-plus members held an emergency virtual meeting on Saturday and agreed to a modest production increase of 206,000 barrels per day for April, a figure analysts described as far too small to offset the scale of potential disruptions. The attacks on Gulf energy infrastructure have drawn Saudi Arabia directly into the conflict, with the kingdom now facing the prospect of sustained Iranian strikes on its oil facilities. Reports also emerged of an Emirati oil platform catching fire in the Gulf after being struck, though this has been reported primarily by Iranian state media and Russian-affiliated outlets and has not been independently confirmed by major Western or Gulf news agencies.
The escalation marks a fundamental shift in the Iran conflict from a military confrontation to an energy war with global consequences. With the world's largest LNG exporter offline, one of its biggest refineries shut down, and the most critical oil chokepoint effectively closed, analysts warn that the economic fallout could dwarf the direct military costs of the conflict. European nations that had been rebuilding gas reserves after the 2022 energy crisis now face the prospect of another supply shock, while Asian economies dependent on Gulf LNG imports are scrambling to secure alternative supplies from markets that are themselves tightening rapidly.
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