FRANKFURT, Germany (AP) - The ongoing conflict in Iran has posed significant risks to critical oil and gas infrastructure worldwide, including pipelines, refineries, and shipping terminals that are essential for transporting energy from Persian Gulf nations to global markets. The conflict has seen strikes from Iranian drones causing operational disruptions and has led to an effective closure of the Strait of Hormuz, a critical chokepoint for maritime shipping. This has resulted in approximately 20% of the world’s oil and liquefied natural gas (LNG) being stranded, while oil fields in countries like Iraq have had to scale back production due to filling storage capacities. Qatar, another significant LNG supplier, has also halted its exports.
Torbjorn Soltvedt, a principal Middle East analyst at Verisk Maplecroft, stated, “A lot of very critical energy infrastructure has been either forced to shut down because of direct damage from drones and missiles, or because production is effectively being shut in as a result of shipping grinding to a halt.” The repercussions of these disruptions are already manifesting globally, with oil prices surging from $72.97 just before the war's outbreak to nearly $103 recently.
The following key infrastructures are at significant risk:
Ras Laffan Liquefied Natural Gas Terminal, Qatar: The terminal was shut down by state-owned QatarEnergy due to a drone strike, greatly unsettling global gas markets. Qatar is responsible for about 20% of the world’s LNG and has cited force majeure, indicating it cannot fulfill contracts due to circumstances beyond its control. This facility processes gas from the world’s largest single gas field and is crucial for deliveries primarily to Asia, while European gas buyers are also impacted as competition for available cargoes increases.
Ras Tanura Port and Refinery, Saudi Arabia: Known as Saudi Aramco’s largest refinery, Ras Tanura was temporarily closed following a drone strike that caused a fire. The port plays a significant role in accommodating large tankers.
East-West Pipeline, Saudi Arabia: This pipeline, operated by Saudi Aramco, transmits oil from the oil processing center near the Persian Gulf to the Yanbu port on the Red Sea, circumventing the Hormuz chokepoint.
Fujairah Oil Terminal, United Arab Emirates: This terminal is essential for very large oil tankers and allows significant oil export from Abu Dhabi without passing through the Strait of Hormuz. Reports indicate that operations have been disrupted due to the conflict.
Torbjorn Soltvedt noted, “Iran’s targeting of oil storage in Fujairah isn’t a coincidence; it’s attacking one of the potential reroutings of oil that’s been trapped in the Persian Gulf.”
Kharg Island, Iran: This tanker terminal handles most of Iran’s crude oil exports, approximately 1.6 million barrels per day, predominantly to China. The current operational status of Kharg Island is unclear.
Leviathan Natural Gas Field, Israel: Due to security concerns, Israel’s Energy Ministry ordered Chevron to cease operations at Leviathan, which is the largest natural gas reservoir in the Mediterranean and a key supplier to Egypt. Earlier shutdowns during previous conflicts have already led to interrupted gas supplies to industries in Egypt.
Southern Iraqi Oil Fields: Iraq has suspended production of approximately 1.5 million barrels per day at crucial fields like Rumaila and West Qurna due to limited storage options. The Rumaila field, classified as a supergiant field, holds over a billion barrels in reserves. Rystad Energy reports that Iraq and various Gulf states are nearing storage capacity, which could lead to further shutdowns of oil fields.
Al Basra Oil Terminal, Iraq: Located 50 kilometers from the shore in the Persian Gulf, this terminal is crucial as it exports oil that constitutes 80% of Iraq’s annual GDP.
Bapco Refinery, Bahrain: The Sitra Island refinery processes supply from Bahraini fields and Saudi Arabia. Operations were halted due to a missile strike that disrupted the supply of jet fuel, diesel, and other refining outputs.
