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Potential U.S. attack on Kharg Island raises oil market concerns

Potential U.S. attack on Kharg Island raises oil market concerns

Reports of a U.S. deployment of 5,000 troops, including Marines on amphibious ships, focus attention on the Iranian oil hub in the Persian Gulf

A potential U.S. attack on Kharg Island is drawing attention as reports indicate that the United States is preparing to deploy about 5,000 troops, including 2,200 Marines, aboard three amphibious ships.

The move raises the prospect of a strike on the Iranian island of Kharg in the Persian Gulf, a critical hub for Tehran’s oil industry and one of the most sensitive economic targets in the ongoing conflict. The terminal handles more than 90% of Iran’s crude oil exports but has remained intact during the 12 days of bombing carried out by the United States and Israel.

A potential U.S. attack on Kharg Island could trigger a sharp rise in oil prices and further destabilize global energy markets.

The strategic role of the island

Located about 55 kilometers from the port of Bushehr and surrounded by unusually deep waters, Kharg Island stretches for only eight kilometers but hosts Iran’s main crude export terminal.

Through underwater pipelines and loading facilities, the island channels oil from central and western Iranian fields to tankers heading mainly toward Asian markets, with China among the principal buyers. Between 1.3 and 1.6 million barrels per day typically pass through the terminal, which also has storage capacity for tens of millions of barrels.

Its strategic value helps explain why the island has so far remained off the list of direct military targets. According to Neil Quilliam, an attack could push oil prices as high as $150 per barrel, up from the $120 levels reached during the most critical phases of the crisis.

Disabling or destroying the facility would remove Iran’s entire export flow from the market at a time when part of regional production is already constrained by tensions in the Strait of Hormuz.

Military and economic risks

Even a military occupation of the island would be highly complex. A potential U.S. attack on Kharg Island would require a large deployment of forces and could create an energy stalemate.

Iran could continue producing oil without being able to export it, while the United States might control the terminal without being able to operate it. Such a scenario could push global oil markets into severe instability.

Historical and symbolic significance

Beyond its economic importance, Kharg Island carries strong historical and symbolic weight. Inhabited since antiquity and contested over centuries by regional and European powers, it became a major oil hub in the 1960s.

The island was heavily bombed during the Iran-Iraq War in the 1980s and is now heavily militarized under Iranian control. Its deep waters—among the few in the Persian Gulf capable of accommodating supertankers—still allow the docking of large tankers transporting what remains the main economic lifeline of the Islamic Republic.

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