Melting fireballs and belching smoke across the Middle East early Thursday signaled a dramatic escalation in the Iran war — and its threat to the global economy.
Israel launched a wide-ranging strike on South Pars, Iran’s world’s largest gas field, triggering retaliation from Tehran against key energy sites across the Gulf Arab states.
Like the blockaded Strait of Hormuz, these facilities dictate global prices for fuel and other commodities, which soared early Thursday. Economists warn that the disruption could cause a global economic shock Triggering price hikes and shortages for billions of people.
With America’s allies in the Gulf and Europe expressing anger, President Donald Trump said there would be no attack on Israel’s gas fields unless Iran bombed U.S. partner Qatar again. If Tehran did so, they vowed to “massively detonate the South Pars gas field.”
Qatar is angry with Iran as well as the US and Israel, a senior official close to its leaders told NBC News. The official said the Gulf kingdom is angry that the war, which is partly to protect oil and gas flows, is now burning up its vital infrastructure.
French President Emmanuel Macron called the escalation “reckless”, adding that he hopes “everyone will come to their senses”.
Brent crude, the international benchmark, rose to $119 a barrel. And wholesale natural gas prices across Europe rose sharply by 25%.
The latest flashpoint began Wednesday When Iranian state media said Israel bombed facilities related to the South Pars gas field it shares with Qatar. Video posted on social media and geolocated by NBC News showed rolling fireballs and black smoke billowing over the refinery in Asalueh on Iran’s Gulf coast.
In response, Iran bombed Qatar’s Ras Laffan Industrial City, a vast steel complex with refineries, storage tanks and pipelines for processing liquefied natural gas, or LNG. It hit a Saudi refinery in the Red Sea and two Kuwaiti oil refineries.
QatarEnergy, the world’s largest supplier of LNG, said in a statement that the attacks caused “large-scale fires and extensive extensive damage” but were extinguished with no casualties.
Trump said the United States “knew nothing” of Israel’s attack, writing that he had been “violently struck” by “fury over what has happened in the Middle East” in a Truth Social post late Wednesday.
A senior official close to the Qatari leader said that Trump’s claim that America knows nothing is not true.
Axios, citing unnamed American and Israeli officials, reported that Trump knew and the US actually had the “green-light” and coordinated the attack with Israeli Prime Minister Benjamin Netanyahu. The goal was to “prevent Iran from continuing to disrupt oil supplies through the Strait of Hormuz,” Axios reported, citing Israeli officials.
The White House did not immediately respond to NBC News’ request for comment.
Countries across the Gulf condemned the escalation and some even raised the prospect of their own direct involvement.
Saudi Arabia’s foreign minister, Prince Faisal bin Farhan, told NBC News in Riyadh of Tehran’s retaliation, “There is a bit of trust that has been completely shattered.”
As Gregory Brew, a senior analyst at the Eurasia Group think tank, put it in X, some analysts came out of the exchange with an assessment that “it really looks like Iran has won this round.”
“Iran came out on top,” agreed Danny Citrinovich, a senior researcher on Iran at the Institute for National Security Studies, affiliated with Israel’s Tel Aviv University.
“It has demonstrated once again that it will not hesitate to raise the level of escalation to protect its strategic assets — without any backtracking on the issue of the Strait of Hormuz,” he wrote. “It’s completely predictable.”
Analysts said a “total blowout” of South Pars was impossible.
It is a vast and complex body of porous rock formed over millions of years. It lies about 3,000 meters below the seabed and covers roughly the same area as Rhode Island.
“But because these facilities are so sensitive you can cause widespread disruption,” said Michael Stephens, a senior fellow at the Royal United Services Institute, a London-based think tank. “Trump understands this, which is why he wants to avoid further attacks on gas fields.”
