WASHINGTON, United States — Global oil prices surged above $110 a barrel on Thursday after reported strikes on major energy infrastructure linked to the South Pars gas field, the world’s largest natural gas reserve, triggered fresh fears over supply disruptions.
The Brent crude oil benchmark climbed to $112 per barrel in early Asian trading, marking a gain of more than 5pc compared to earlier in the week. Prices later eased slightly but remained elevated, reflecting heightened geopolitical risk.
At the same time, the United Kingdom’s benchmark gas price rose by about 6pc to 143.53p per therm before retreating toward the 140p level.
Strikes on Strategic Energy Sites
The price rally followed Iranian media reports that an airstrike had hit a petrochemical facility at South Pars, a critical energy hub jointly shared by Iran and Qatar. The gas field—known as North Dome in Qatar—accounts for a significant share of global liquefied natural gas (LNG) supply.
Hours after the initial reports, Qatari authorities confirmed “extensive damage” at the Ras Laffan Industrial City, a key LNG processing and export site, following what officials described as an Iranian attack.
Qatar’s interior ministry said a fire broke out at the facility around 1815 GMT but was largely contained within an hour, with no casualties reported. State-owned QatarEnergy later confirmed the extent of the damage.
Escalation Risks and Global Impact
Iran’s oil ministry said the fire at its South Pars petrochemical complex had been brought under control, according to Tasnim news agency, which is affiliated with the Islamic Revolutionary Guard Corps.
However, Iran’s military issued a strong warning, stating it would take “decisive action” if its energy infrastructure continued to be targeted. In a statement, it warned that retaliatory strikes could extend to energy facilities in countries it considers responsible.
Analysts say such rhetoric raises the risk of a broader regional escalation, with potential consequences for global energy markets already under strain.
Qatar, which produces roughly a fifth of the world’s LNG, had earlier in March halted some production due to the ongoing conflict. Its foreign ministry spokesperson, Majed Al Ansari, warned that attacks on energy infrastructure pose a direct threat to global energy security.
Prices Still Below Recent Peaks
Despite the sharp uptick, both oil and gas prices remain below levels recorded earlier this month. Brent crude reached $116.78 per barrel on March 9, while UK gas prices peaked at 162.55p per therm on March 3.
Market and Policy Implications
The developments highlight the vulnerability of global energy supply chains to geopolitical shocks, particularly in the Gulf region, which remains central to both oil and LNG exports.
As tensions persist, traders are expected to closely monitor further military developments and production updates from both Iran and Qatar, with any escalation likely to trigger additional price spikes.
