Donald Trump stated Friday that Israel “will not be attacking” Iran’s gas facilities, following a reported Israeli strike on the South Pars gas field. The announcement, made via Trump’s social media platform, came after days of escalating tensions and retaliatory actions in the Middle East, and as oil prices experienced significant volatility.
The initial strike on South Pars, a field shared with Qatar (known as North Field in Qatar), prompted Iran to issue a warning of severe retaliation. According to reports, Iran subsequently launched missiles toward Saudi Arabia and Qatar, targeting energy infrastructure. Qatar’s Ras Laffan liquefied natural gas facility reportedly sustained “extensive damage” as a result of the attacks. Saudi Arabia reported intercepting four ballistic missiles.
Oil prices initially surged in response to the attacks, with Brent crude briefly reaching $119 a barrel. However, following Trump’s statement and reports that Israel was assisting in keeping the Strait of Hormuz open, prices reversed course. Brent crude settled at $107.83 a barrel, a 0.4% increase, while West Texas Intermediate (WTI) crude fell 0.2% to $96.14 a barrel.
Trump indicated he had advised Israel against further attacks on Iranian energy infrastructure. He later elaborated at the White House, stating he had told them “not to do it.” Treasury Secretary Steven Mnuchin affirmed that the U.S. Would not intervene in oil-related financial markets, but left open the possibility of further releases from the Strategic Petroleum Reserve to lower prices. He also dismissed suggestions that the Treasury would directly intervene in oil futures markets.
The escalating conflict also impacted precious metals markets. Gold prices fell sharply, dropping 3.5% to $4650.02, while silver prices declined 3.4% to $72.8251. U.S. Stock markets also closed lower, with the Dow Jones Industrial Average falling 203 points to 46021, the S&P 500 dropping 0.3% to 6606, and the Nasdaq declining.
Qatar reported that its LNG facility had been damaged, and concerns remain about the impact on global LNG supplies, particularly for Asian buyers. The disruption to Qatar’s LNG production, estimated at 17%, adds to existing anxieties about energy security.
As of Friday evening, the Biden administration had not issued a public statement regarding Trump’s intervention or the ongoing situation in the region. No further diplomatic initiatives have been announced.
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