Middle East war: why tit-for-tat attacks on gasfields are a major escalation
Strikes on South Pars and Ras Laffan are first time fossil fuel energy production facilities have been hit. Why is it significant?
The strikes on so-called upstream gas production facilities by both sides of the Middle East war mark a significant escalation and could have long-term consequences.
It is the first time facilities connected to the production of fossil fuel energy have been hit, rather than sites associated more generally with the oil and gas industry.
What has been targeted in recent days?
On Tuesday a successful Iranian drone attack resulted in operations at the Shah gasfield, about 111 miles (180km) south-west of Abu Dhabi, being suspended. The site can produce 1.28bn standard cubic feet of gas a day. It supplies about 20% of the UAE’s gas supply and 5% of the world’s granulated sulphur, which is used in phosphate fertilisers.
On Wednesday an Iranian production facility for the South Pars gasfield, which it shares with Qatar, was struck. The field is the largest in the world and the biggest source of domestic energy in Iran, which sometimes struggles to produce enough electricity.
The strike, which prompted a threat from Tehran of further retaliation against energy infrastructure, was widely reported in Israeli media to have been carried out by Israel with US consent, though neither country immediately confirmed responsibility.
Although Donald Trump said the US had not been given warning of the attack, it seems highly unlikely that US intelligence would not have known about it or that two allies fighting a war together, involving joint military flight traffic control, would not both have been aware.
An Iranian attack subsequently caused “extensive damage” to Qatar’s giant Ras Laffan liquefied natural gas (LNG) facility, sending gas prices rocketing and prompting dire warnings over the global economic impact. The price of European gas jumped 35%. Qatar is one of the world’s top LNG producers, alongside the US, Australia and Russia, and Ras Laffan is the world’s largest LNG hub.
Iranian drones also struck a Saudi oil refinery on the Red Sea and caused fires at two others in Kuwait.
Why are the strikes important?
The attack on Qatar’s hub “marks a significant escalation in the Middle East war”, Theresa Fallon, the director of the Centre for Russia Europe Asia Studies, wrote on X, adding: “The economic effect will likely be felt for years.”
Although a cessation of hostilities could result in suspended gas and oil shipments returning within months, experts say significant damage to production infrastructure could have an impact that lasts far longer.
Oil prices shot up after the South Pars attack after fears that disruption to global energy supplies would worsen. It raises the political stakes for Trump in the run-up to the US midterm elections in November. Diesel prices in the US have risen above $5 a gallon for the first time since the inflation surge in 2022, which eroded support for his predecessor, Joe Biden.
Emmanuel Macron, France’s president, on Thursday called the latest tit-for-tat attacks on energy infrastructure in the Gulf a “reckless escalation”. Katherina Reiche, Germany’s economy minister, said a global recession could result as Iran issued threats to destroy the region’s energy infrastructure if its facilities were attacked again.
How have countries in the region reacted?
After the South Pars attack, Iran listed an array of prominent regional oil and gas sites belonging to Saudi Arabia, the UAE and Qatar that it said were now “direct and legitimate targets” and should be evacuated at once. Loud explosions were heard in Riyadh, the Saudi capital, a few hours later.
Qatar, a close ally of the US, which hosts the largest American airbase in the region, blamed the attack on Israel without mentioning any US role. The Qatari foreign ministry spokesperson called it a “dangerous and irresponsible” escalation that put global energy security at risk.
The UAE said the South Pars attack posed a threat to global energy and to the security and stability of the region.
Prince Faisal bin Farhan, Saudi Arabia’s foreign minister, said “what little trust” the country had built with Iran had been “shattered on multiple levels”, in a press briefing overnight on Thursday. He accused Iran of attacking Riyadh during a meeting of high-level diplomats from the region.
Can’t the damage just be repaired?
One lesson from the 2003 invasion of Iraq was that it took much longer than expected to repair damaged energy production infrastructure. The Bush administration had promised that reconstruction would be funded by oil revenues, but even though contractors were able to access Iraqi plants and $2bn was spent on oil projects, production took more than two years to return to prewar levels.
Attempts to repair Ukrainian power infrastructure hit by Russia has highlighted issues around equipment logjams.
What role does energy production play in the Gulf beyond income?
Energy production in the Gulf has a social, political and diplomatic importance far beyond the economic top line. Social settlements where citizens live under often repressive monarchies are based on the sharing of energy wealth. It is vital to living standards and the ability to attract foreign workers.
Energy is integral to the way countries in the region interact with each other. The brief detente between Iran and Saudi Arabia, which survived Israel’s attacks on Iran’s nuclear facilities last year, was a priority for Mohammed bin Salman, Saudi Arabia’s de facto ruler, as part of his plans to diversify the Saudi economy. He assessed that tensions with Iran were a drain on resources. On the Iranian side the detente was driven by an economy slowly imploding under US-led sanctions.
Historically closer to Iran because of a shared interest in the South Pars field, Qatar’s anxiety over the attack has been palpable. The field has at times acted as a diplomatic bridge not only between Doha and Tehran but more widely.