This video grab taken from UGC images posted on social media shows two oil tankers on fire off the coast of Iraq. Photo: AFP
TEHRAN:
The Middle East war is creating the biggest oil supply shock in history, the International Energy Agency warned Thursday, as Iran launched a new wave of attacks against Gulf energy targets that sent prices spiking above $100 a barrel.
Images from Bahrain showed thick smoke rising after a strike on fuel tanks in Muharraq, with residents told to stay inside and close their windows.
Drones caused damage again at Kuwait’s international airport, explosions were heard in downtown Dubai, and Saudi Arabia said it had intercepted drones headed towards its Shaybah oil field and its embassy district.
The Paris-based IEA, a world authority on energy markets, said the 13-day conflict “is creating the largest supply disruption in the history of the global oil market”, which would surpass those of the 1970s.
The Gulf states’ total oil output is down by at least 10 million barrels per day and there were “no signs of a de-escalation in hostilities,” it added.
With Gulf states slashing production and oil tankers prevented by Iranian threats and attacks from crossing the crucial Strait of Hormuz, benchmark oil prices have risen between 40-50 percent since the US and Israel attacked Iran on February 28.
A top Iranian military figure warned on Wednesday that the country could wage a prolonged war that would “destroy” the world economy, while US President Donald Trump insisted that Iran was facing imminent defeat.
The US leader, who is under mounting domestic pressure, also cautioned that the military campaign would not end “immediately” despite indicating that US forces were running out of targets to hit in the Islamic republic.
The conflict has rapidly spread across the region, with hundreds killed by Israeli strikes in Lebanon, including at least eight more who died on Beirut’s blood-stained seafront on Thursday.
Over three million people have been displaced inside Iran by the war, according to the UN’s refugee agency.
Shipping in and around the crucial Strait of Hormuz remains at a near-standstill, with another three ships attacked in the Gulf off the coast of the United Arab Emirates and Iraq.
Authorities in Iraq announced overnight a “sabotage” attack on two oil tankers, with at least one crew member from India reported dead.
The Strait of Hormuz, through which a fifth of the world’s oil and liquefied natural gas (LNG) passes, lies off Iran and is just 54 kilometres (34 miles) wide at its narrowest point.
Tehran has vowed that not one litre of oil will be exported from the Gulf while US-Israeli attacks continue, although industry figures suggest its own sanction-hit exports are continuing to get through.
