In any geopolitical conflict, there is a fateful geographic point on which all attention and tension is focused. In the current escalation of violence between Israel and Iran, this point is the small island of Kharg. With an area of only 24 square kilometers, theevely smaller than Isla Graciosa or the Madrid municipality of Patonesthis islet rather located in the Persian Gulf, 25 kilometers south of the Iranian coast and 483 km northwest of the Strait of Hormuzis the Gordian knot of Iranian oil, since nearly 95% of the country’s exports pass through it. It goes without saying how sweet this objective is for Israel and the risks that a possible massive attack against it carries, since Iranian oil represents 4% of world production.
This threat heats up the oil. The price of Brent crude oil, a benchmark in Europe, continued to rise with some intensity on Wednesday with an increase of more than 2% after having skyrocketed on Tuesday due to the rise in tensions generated between Iran and Israel. Currently, Brent is trading near $75 per barrel, up from $70 early Tuesday morning. Fear of a possible Israeli attack on Kharg Island and Iranian oil infrastructure in general (Tehran’s source of revenue), tougher sanctions that also pulverize some of Iran’s crude oil, or all-out war inflate the geopolitical risk premium.
An even more diabolical scenario can be proposed, like the one drawn by RBC Capital Markets analysts. Energy infrastructure could become a target for either side, and export facilities on Kharg Island could also be an “own” target.warn these strategists. What does this mean? That Tehran and its partners could attack energy operations there “to internationalize costs if the current crisis escalates into all-out war.”
Brett Stephenscolumnist in The New York Timesrightly pointed out just a few hours ago that “the Iranian economy depends largely on a vast and vulnerable network of pipelines, refineries and oil terminals”, notably on the island of Kharg in the Persian Gulf. The (US) government can warn the regime that the only way to save this infrastructure from immediate destruction is to order Hezbollah and the Houthis to stand down and pressure Hamas to release its Israeli hostages. We cannot continue to try to frustrate Iran with defensive means alone, fighting not to win but simply not to lose. » What makes Kharg Island such a valuable treasure for Iran?
An island full of oil
Since the mid-20th century, this small island has become a key strategic point in the country’s petroleum infrastructure due to its geographic location and the capabilities it offers for the storage and transportation of Iranian crude oil. Kharg has the capacity (with its infrastructure) process up to 7 million barrels of crude oil per dayas published by the United States Energy Information Administration in a note. Despite sanctions and the temporary reduction in exports, Iran has continued to export large quantities of oil, and Kharg Island remains the main outlet for Iranian oil.
The North American period The New York Times A few months ago, I published a detailed report entitledr “US $2.8 Billion Hole in Iran Sanctions” which had this small island as its protagonist due to its immense ability to move oil from one place to another without arousing too much suspicion.
“We cannot know on a daily basis exactly what each ship is doing, where it is going, what it is carrying, who its owners are,” Daniel Tadros, director of operations for the American Club, said in statements to the newspaper. American. “I would like to think that governments have a lot more capacity, manpower and resources to keep up with this.”
Iran produces large quantities of oil
Iranian oil production has increased by 50% over the past two years, which triggered the traffic of vessels laden with crude oil seeking to export “black gold” via Kharg Island as a basis. Many of these tankers end up in China, which has tripled its imports of Iranian oil over the past two years.
Kharg’s infrastructure includes large capacity storage tanks and terminals capable of handling large vessels, including supertankers (VLCCfor its acronym in English). This makes Kharg a key hub for exports, with Iran being one of the countries with the largest proven oil reserves in the world.
The relevance of Kharg lies not only in its storage capacity but also in its geographical position. The island is located near the Strait of Hormuz, one of the world’s most important shipping lanes for transporting oil. About a third of all oil traded globally passes through this strait, giving Iran, and particularly Kharg, considerable influence over global energy routes. Any disruption to operations on Kharg Island or in the Strait of Hormuz could have serious consequences for global oil prices, as has been seen in several incidents over the years.
Geopolitically, Kharg Island represents a key asset in the context of international tensions around Iran, particularly with sanctions imposed by the United States and growing competition in the Persian Gulf region. Due to its importance to Iranian exports, the island and its facilities have been targeted in previous conflicts, cAs during the Iran-Iraq war (1980-1988)when Iraqi forces attempted to disrupt Iranian oil exports by bombing Kharg repeatedly. Despite these attempts, the infrastructure has remained largely operational, demonstrating Iran’s resilience in protecting this vital asset.
Yeah Israel or the United States decide to tackle this oil Gordian knotthe crude oil market could end up upside down. IG analysts point out in a published note that there has been speculation in the market regarding a possible attack by Israel on Iranian oil fields or infrastructure. This could have further inflated crude oil prices. However, IG analysts believe that this scenario seems “unlikely”. The “destruction” of the global economy would be notable, in addition to reversing the current powerful disinflation, which has become positive news in recent months for the global economy.
