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Iran’s strategic oil island thrust into the spotlight as Middle East conflict escalates
PUBLISHED MON, MAR 9 20264:45 AM EDTUPDATED 2 HOURS AGO
KEY POINTS
• Kharg Island serves as the centerpiece for Iran’s oil industry, accounting for roughly 90% of the country’s crude exports.
• The small coral island, which is nestled in the waters of the northern Persian Gulf, has so far been left untouched during the U.S. and Israeli-led war on Iran.
• Analysts say U.S. President Donald Trump may be tempted to order U.S. forces to try to seize Kharg Island, while warning that any such move would be fraught with risk.
Iran’s Kharg Island, a small but strategically vital strip of land nestled in the waters of the northern Persian Gulf, has been left untouched by U.S. and Israeli forces even as the Middle East conflictenters its second week.
The coral island, which is located about 15 miles off the coast of mainland Iran, serves as the centerpiece for Iran’s oil industry.
It is estimated that around 90% of the country’s crude exports pass through it before tankers then travel through the Strait of Hormuz. The island is also said to have a loading capacity of roughly 7 million barrels per day.
Kharg Island’s economic importance to Iran makes it particularly vulnerable to the threat of military action, although analysts say that any attempt to seize it would likely require a ground troop operation, which the U.S. appears reluctant to undertake.
An attack would also likely prompt further energy market volatility at a time when oil prices have soared to more than $100 a barrel.
Seizing the island “would cut off Iran’s oil lifeline,” which is essential for the regime, according to Petras Katinas, a research fellow in climate, energy and defense at RUSI, a London-based defense think tank.
“Of course, with shipping via the Strait of Hormuz now stopped, they cannot sell oil anyway, but looking ahead, seizure would give the US leverage during negotiations, no matter which regime is in power after the military operation ends,” Katinas told CNBC by email.
“Yet, seizure, would require a ground troop operation, which this administration seems hesitant to undertake. At least for now,” he added.
Crude futures climbed to their highest level since mid-2022 on Monday after the U.S. and Israel launched a fresh wave of strikes across Iran over the weekend.
The attacks struck several Iranian fuel sites, including oil storage depots, signaling a new phase of the war as the sprawling Middle East crisis continues into its tenth day.
International benchmark Brent crude futures
with May delivery traded over 13% higher at $104.85 per barrel on Monday morning, paring earlier gains, while U.S. West Texas Intermediate futures
with April delivery were last seen 12.6% higher at $102.42.
https://www.cnbc.com/2026/03/09/iran-war-us-israel-conflict-oil-prices-kharg-island.html