Iran targets energy facilities across Gulf after Israel struck its key gas installations

By Jaidaa Taha, Yousef Saba, Jana Choukeir and Yomna Ehab

March 19 (Reuters) - European state prices surged 25% and lipid gained 10% connected Thursday aft Iran attacked vigor infrastructure successful the Middle East successful retaliation against Israeli attacks connected it state facilities, marking the biggest escalation of the astir three-week war.

The Iranian aerial attacks caused extended harm to the world's ‌largest state works successful Qatar, targeted a refinery successful Saudi Arabia, forced the United Arab Emirates to unopen state facilities and started fires astatine 2 Kuwaiti refineries.

The terms of benchmark Brent crude ‌rose to supra $119 a tube connected Thursday, portion state prices successful Europe were treble the level seen successful precocious February earlier the U.S. and Israel launched their warfare connected Iran.

"This latest escalation feels similar a turning constituent for markets due to the fact that the struggle is nary ​longer conscionable astir subject headlines oregon Strait of Hormuz closure," said Charu Chanana, main concern strategist astatine Saxo successful Singapore.

"It is present hitting the plumbing of the planetary vigor system. What is unsettling markets present is the increasing stagflation risk," she added.

EUROPEAN LEADERS SEEK QUICK FIXES

European leaders connected Thursday volition effort to hold connected speedy fixes to mitigate surging prices caused by the tit-for-tat attacks connected cardinal facilities and the closure of the Strait of Hormuz, done which immoderate 20% of planetary lipid and liquefied earthy state supplies usually pass.

But immoderate governments uncertainty that the EU - whose 27 subordinate states person vastly antithetic vigor mixes and nationalist taxes connected vigor - tin realistically offset a ‌price spike.

The attacks connected South Pars successful Iran and Qatar's Ras Laffan ⁠plant correspond a crisp escalation, not conscionable successful the struggle itself but successful its implications for vigor markets, Rob McLeod, caput of vigor terms hazard solutions astatine Hartree Partners, said successful a LinkedIn post.

Major infrastructure harm means facilities could instrumentality months oregon years, not weeks, to restart, helium said.

South Pars is the Iranian assemblage of the ⁠world's largest earthy state deposit, which Iran shares with Qatar, a adjacent U.S. ally, crossed the Gulf. Qatar's overseas ministry rebuked Israel for a "dangerous and irresponsible" onslaught connected Iran's South Pars facilities, and denounced Iran for what it called "a flagrant breach" of planetary law, expelling 2 elder Iranian diplomats.

On Thursday, a drone fell connected the Aramco-Exxon refinery, SAMREF, the Saudi Arabian Defence Ministry said, adding harm was being assessed. It besides intercepted a ballistic rocket launched towards Yanbu, the Red ​Sea ​port metropolis that is presently Saudi Arabia's lone outlet for crude exports and wherever the refinery is located.