European powers and Japan promised to stabilise energy markets and join “appropriate efforts” to open the Gulf’s energy chokepoint after strikes on energy plants dramatically heightened the US-Israeli war on Iran.
This is coming two days after NATO allies refused to help the United States President, Donald Trump, reopen the Strait of Hormuz.
A report by Reuters stated that countries have been scrambling to cushion the impact of soaring energy prices after Qatar reported “extensive damage” from Iranian missile strikes on Ras Laffan Industrial City in response to Israel’s bombing of Iran’s major gas field. Ras Laffan processes about a fifth of the world’s liquefied natural gas.
Our correspondent observed that Brent crude rose from $108 per barrel on Wednesday to $114 on Thursday before dropping to $110.
Reuters reports that Saudi Arabia’s main port on the Red Sea, where it has been able to divert some exports to avoid Iran’s closure of the Gulf’s exit point, the Strait of Hormuz, was also attacked.
The strikes, it was learnt, underscored Iran’s continued ability to exact a heavy price for the US-Israeli campaign and the limits of air defences in protecting the Gulf’s most valuable and strategic energy assets.
With no end in sight, almost three weeks into the war, and the threat of a global oil shock growing by the day, Britain, France, Germany, Italy, the Netherlands, and Japan issued a joint statement expressing “our readiness to contribute to appropriate efforts to ensure safe passage through the strait”.
They also promised “other steps to stabilise energy markets, including working with certain producing nations to increase output”.
The statement was a significant shift after weeks of resistance by major US allies to Trump’s demands that they help secure the strait, intervening in a conflict with unclear objectives that they did not seek and over which they have little control.
In particular, Israel’s bombing of Iran’s South Pars gas field, which Trump said the U.S. had not known about, suggested gaps in coordination of strategy and war aims between the main protagonists.
US Defence Secretary Pete Hegseth said the US objectives in the war were “unchanged, on target and on plan”.
But Director of National Intelligence Tulsi Gabbard told the House intelligence committee that the US and Israeli goals differed, saying, “…the Israeli government has been focused on disabling the Iranian leadership.
The (US) president has stated that his objectives are to destroy Iran’s ballistic missile launching capability, their ballistic missile production capability, and their navy.”
QatarEnergy’s CEO told Reuters the Iranian attacks had knocked out a sixth of Qatar’s liquefied natural gas export capacity, worth $20bn a year, and that repairs would take three to five years.
Brent crude oil futures were up nearly 4.5 per cent at $112, having surged up to 10 per cent before the joint statement. European near-term gas prices were up more than 15 per cent and have leapt by over 60 per cent since the war began.
Japanese and South Korean stocks fell around 3 per cent, while the pan-European index was down 2.3 per cent, around its lowest in more than three months. On Wall Street, the Dow Jones Industrial Average was down about one per cent.
Fears of lasting inflation pressures encouraged both the European Central Bank and Bank of England to hold rates steady, and investors who once expected cuts were pricing in hikes by year-end. The ECB now sees 2026 inflation at 2.6 per cent, above the 1.9 per cent predicted in December.
At a summit in Brussels, European Union leaders sought ways to offset higher energy costs for industries and consumers already struggling with the rising cost of living.
Iranian attacks since Wednesday have also forced the UAE to shut its Habshan gas facility and set off fires at two Kuwaiti oil refineries.
Saudi Arabia reportedly intercepted a ballistic missile heading for Yanbu, the port city that is the kingdom’s only outlet for crude exports since Iran in effect closed the Strait of Hormuz, through which around a fifth of the world’s crude oil and liquefied natural gas normally passes.
Israeli media reported that an Iranian strike hit oil facilities in Israel’s port of Haifa, causing damage but no casualties.
Iran’s military said strikes on Iran’s energy infrastructure had led to “a new stage in the war” in which it had attacked energy facilities linked to the United States.
“If strikes (on Iran’s energy facilities) happen again, further attacks on your energy infrastructure and that of your allies will not stop until it is completely destroyed,” spokesman Ebrahim Zolfaqari said, according to state media.
Trump, politically vulnerable to rising fuel prices among his core voters, said Washington had had no advance knowledge of Israel’s attack on Iran’s gas field and that Qatar – host to the Gulf’s largest US air base – had not been involved.
He said Iran had then “unjustifiably and unfairly attacked” Qatar’s LNG plant. He warned that if it did so again, the US, “with or without the help or consent of Israel, will massively blow up the entirety of the South Pars Gas Field”.
A US official and three other people familiar with the planning told Reuters that Trump was considering sending thousands more US troops to the Middle East. They could be used to help restore shipping through the Strait of Hormuz, potentially even landing in Iran or its Kharg Island oil hub.
