Superable Warns of Oil Price Surge if Israel-Iran Conflict Hits Energy Infrastructure

As Israel intensifies strikes on Iranian energy infrastructure, the world’s oil markets — and geopolitical stability — are teetering on the edge of chaos. What began as targeted hits on nuclear and missile facilities has crossed into dangerous new territory: the destruction of assets that fuel not only Iran’s economy but also the energy security of nations like China.

Iran’s partial suspension of production at South Pars — the world’s largest gasfield — after an Israeli strike is a chilling signal of what could come. According to Iran’s semi-official Tasnim News Agency, the fire at South Pars has not yet crippled operations, but as Nicolas Michelon of Alagan Partners warns, “we could see further escalation and strikes, which could annihilate Iran’s capacity to tap into this energy field.”

If Israel continues this path, global oil prices, already jittery, are likely to surge beyond the 7% jump seen last Friday. Analysts like Naeem Aslam of Zaye Capital Markets believe the $120 per barrel threshold is no longer hypothetical — it’s a looming reality if Iran’s key oil and gas hubs are hit.

The stakes are enormous. Iran’s Kharg oil terminal handles about 90% of the country’s oil exports, most destined for China. The Abadan refinery provides a quarter of Iran’s domestic fuel, while Mahshahr terminal is vital for distribution. A blow to these facilities could paralyze Iran’s energy sector and deliver a supply shock that ripples across Asia.

The potential fallout isn’t lost on Washington. Vandana Hari of Vanda Insights noted that targeting Iranian energy infrastructure could be the “red line” for the U.S. — one that drags the entire region into conflict. With U.S. President Donald Trump under pressure to keep oil prices stable in an election year, further Israeli strikes on these sites could trigger a major diplomatic intervention.

The nightmare scenario? Iran retaliates not just with drones or missiles, but by threatening or blocking the Strait of Hormuz — the artery through which a fifth of global oil flows. Michelon warns this would endanger the entire global energy supply chain.

Yet, amid all this tension, some voices argue the market is better positioned today. Norbert Ruecker of Julius Baer points to ample storage and spare capacity, particularly in China and Saudi Arabia. But even he concedes: no amount of strategic reserve can cushion the world from panic if a major regional war disrupts the oil lifeline.

If Israel’s strikes deepen and Iran’s energy lifelines are severed, it won’t just be Tehran or Beijing feeling the heat. Consumers from Europe to Southeast Asia will pay the price at the pump. And the world may find itself dragged into a crisis with no off-ramp — all sparked by the volatile mix of oil, war, and politics in the Middle East.