Trump’s warning over Kharg Island raises the stakes for Iran’s oil exports
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Trump's decision to order strikes on Kharg Island has pushed one of the world's most critical oil hubs into the center of the escalating U.S.-Iran conflict.
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President Donald Trump's order to strike Iranian military assets on Kharg Island has thrust one of Tehran's most critical oil hubs into the center of the escalating U.S.-Iran conflict. Trump said the strikes, carried out Friday night, targeted military facilities and spared oil infrastructure. But he warned the United States could attack crude facilities on the island if Iran continues attacks on commercial vessels in the Strait of Hormuz, a key shipping artery for global energy supplies. "The strike on the military facilities of Kharg was meant to serve as a warning shot to Tehran. If it doesn't reopen the Strait of Hormuz, the oil infrastructure on the island would be next," Vandana Hari, founder of Vanda Insights, told CNBC in an email on Monday. Kharg Island is regarded as one of Iran's most sensitive economic targets. The five-mile-long coral island, located about 15 miles off the coast of mainland Iran in the northern Persian Gulf, handles roughly 90% of the country's crude exports . It also has a loading capacity of about 7 million barrels per day, making it a critical gateway for Tehran's energy revenue. Iran's economic lifeline A direct hit on Iran's export terminal on the island would instantly shut down most of its 1.5 million barrels per day crude exports, data provided by JPMorgan showed . "Destruction of its oil infrastructure would take years to rebuild, leaving the country deprived of its most critical source of revenue," Hari added. "War-risk insurance premiums will likely remain elevated long after the last missile is fired. And the behavioral response ... permanently reprices the supply chain." Jeff Currie Chief Strategy Officer of Energy Pathways, Carlyle Energy analysts said Washington's focus on Kharg Island reflects both the island's strategic importance to Iran and its leverage over global oil markets. "Iran has other ports, but presumably if the U.S. took control of or destroyed Kharg Island, it would be possible to do the same to the other ...
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