Iran-Iraq Gas Halt & Escalating Conflict: US, Israel & Gulf States on Alert

Iran halted gas supplies to Iraq and threatened further attacks on energy infrastructure across the Gulf today, escalating a conflict triggered by an Israeli strike on the South Pars gas field. The move came as U.S. President Donald Trump warned he would “massively blow up” the entirety of the South Pars field if Iran continues to target facilities in Qatar, according to a post on his social media platform.

The Israeli strike on South Pars, a field shared with Qatar, prompted retaliatory attacks by Iran on energy facilities in Saudi Arabia, Kuwait, and Qatar, including the Ras Laffan Industrial City, a major LNG export hub. QatarEnergy CEO Saad al-Kaabi told Reuters that the attacks damaged facilities representing 17% of the company’s LNG export capacity, with repairs expected to take three to five years.

The attacks have sent shockwaves through global energy markets, with European natural gas prices jumping as much as 35% today, and Brent crude oil reaching $112 a barrel. The European Central Bank warned that the conflict has created “significant uncertainty” and carries a risk of higher inflation and lower economic growth.

U.S. Defense Secretary Pete Hegseth stated that the U.S. Has struck over 7,000 targets across Iran and its military infrastructure, claiming Iran’s ballistic missile production capacity has been reduced by 90%. He added, “We will finish this,” but declined to provide a timeline for the conflict’s resolution.

The Pentagon has requested $200 billion in funding from the White House for the war in Iran, a figure Hegseth acknowledged “could move.” This request follows an initial expenditure of over $11.3 billion for the first six days of the conflict.

Israel confirmed that the attack on South Pars was coordinated with the United States, despite Trump’s claim that Washington had no prior knowledge. Israeli officials, speaking anonymously to Reuters, indicated this dynamic mirrored a similar situation following previous Israeli strikes on Iranian fuel depots.

The conflict has resulted in significant casualties. Human rights group HRANA estimates more than 3,000 people have been killed in Iran since the attacks began, while Lebanese authorities report over 1,000 deaths and 800,000 displaced individuals following Israeli strikes in Lebanon. A missile strike similarly landed inside an oil refinery complex in Haifa, Israel, though no casualties were immediately reported.

Several nations, including the UK, France, Germany, Italy, the Netherlands, and Japan, have jointly expressed concern over the escalating conflict and pledged to contribute to efforts to ensure safe passage through the Strait of Hormuz. However, Iran continues to effectively close the strait, a critical waterway for global oil and gas transport.

Oman’s foreign minister, Badr Albusaidi, writing in The Economist, criticized the Trump administration for “losing control of its own foreign policy” and blamed Israel for derailing potential negotiations with Iran. He stated that a deal to avert war “appeared really possible” before the recent escalation.

EU leaders are meeting today to discuss ways to mitigate the impact of rising energy prices, but concrete solutions remain elusive. The Climate Action Network, representing over 1,900 climate organizations, condemned the attacks as “an illegal act of aggression” and “ecocide,” calling for an immediate ceasefire.

Iran’s intelligence ministry reported the arrest of 97 individuals accused of collaborating with Israel, as part of a broader security sweep targeting alleged links to Israel and the United States.