Oil, gas and Iran economic analyst
Iran has shown it can disrupt regional energy flows. What remains far less clear is whether it can use that leverage to shape the outcome of the conflict in its favor.
Over the past several days, Iranian missiles have targeted three oil tankers and several oil and gas facilities in neighboring countries while also obstructing maritime traffic through the Strait of Hormuz.
The immediate market reaction was sharp but limited. On Monday, Brent crude surged more than 8 percent to $79 per barrel. Yet this level remains well below earlier projections tied to a potential full closure of the Strait of Hormuz.
So far, Tehran has failed to generate sufficient pressure on Washington by attacking tankers and regional energy infrastructure. On March 2, following two drone strikes on its gas facilities, Qatar announced a temporary suspension of liquefied natural gas (LNG) production.
The Strait of Hormuz accounts for roughly 20 percent of global LNG trade and a similar share of global oil and petroleum product consumption.
Last year, over 80 percent of the crude oil and LNG passing through the strait was destined for Asian markets. Still, Qatar’s LNG suspension triggered a 45 percent surge in European gas prices—underscoring the fragility of global energy interdependence.
Why haven’t oil prices spiked further?
The muted market response, despite near-disruptions to Hormuz transit, has several structural explanations.
First, according to the International Energy Agency, global oil markets were already oversupplied last year. If tanker disruptions in the Strait of Hormuz persist over the medium term, however, market conditions could tighten considerably.
Second, Saudi Arabia and the United Arab Emirates possess alternative pipeline routes capable of bypassing the strait. Combined, these pipelines can transport an additional 2.6 million barrels per day to global markets. This represents about 40 percent of their normal crude exports but remains a significant mitigating factor.
Iran has previously demonstrated its willingness to target critical infrastructure. In 2019, it struck Saudi facilities in Ras Tanura and the Abqaiq oil processing hub—located roughly 55 miles away—which is connected via a 1,200-kilometer pipeline to the Red Sea. On March 2, Iran again targeted the Ras Tanura refinery.
Thus far, however, Tehran has not attacked the Saudi and Emirati pipelines designed to bypass Hormuz. Should it do so, oil prices would likely rise again—but probably not to levels that would trigger severe market dislocation given current supply buffers.
Inventory data reinforce this point. OECD members—including the United States, the European Union, the United Kingdom, Japan and Canada—hold commercial oil stocks of about 2.8 billion barrels. These reserves provide weeks of supply flexibility in the event of temporary disruption.
Iran itself reportedly holds around 200 million barrels of oil in floating storage in Asian waters and could continue deliveries to Chinese buyers for several months.
Taken together, these factors suggest that in the short term Iran’s oil weapon is unlikely to prove an effective instrument for destabilizing global markets or compelling Washington to halt its military operations.
Tehran’s apparent objective may instead be to pressure US-aligned Arab states into urging Washington to cease its attacks.
This strategy, however, carries significant risks. On March 1, Saudi Arabia signaled it would respond to Iranian attacks and placed its armed forces on heightened alert. Continued escalation could push the kingdom and other Arab states to join the US-Israeli military campaign.
The risk of a protracted conflict
US and Israeli officials have indicated that operations against Iran could continue for several weeks. The key question is whether Tehran can sustain a prolonged war of attrition.
Around 70 percent of Iran’s non-oil trade passes through ports that depend on access via the Strait of Hormuz. While Tehran may be able to disrupt the strait in the short term, sustained interference would disproportionately harm its own economy.
Thus far, the United States and Israel have not targeted Iran’s oil facilities or broader industrial and economic infrastructure, and they may prefer to avoid doing so. But that could change if Iran continues attacking regional energy assets and obstructing Hormuz transit.
Any such escalation could severely damage the country’s already fragile economy.
Another possible countermeasure would be the formation of an international coalition to secure maritime traffic through the Strait of Hormuz—effectively neutralizing Tehran’s leverage over global energy trade.
Finally, it is important to note that the Islamic Republic faces a severe domestic legitimacy deficit. Further weakening of the state could increase the likelihood of widespread unrest similar to the protests of January 2026, potentially raising the prospect of regime collapse from within.
All in all, Iran’s oil weapon appears structurally constrained. While capable of generating volatility, it is unlikely to deliver decisive strategic leverage.
Speaking to Euronews, Gideon Sa'ar said the operation would continue without a fixed end date.
“So there is no time like the operation there. There is no timeline that you're looking at. There is no timeline of this operation. Now, we hadn't gave to ourselves timeline,” Sa’ar said.
“Naturally, we want it to be as short as possible. This is clear. But we didn't put to ourselves any timeline,” he added.
Sa’ar described the campaign as coordinated fully with Washington.
“It’s not that they [the United States] support us. They are working with us hand in hand, working together to achieve the same goals we are. It's, it's a, it's a mutual operation,” he said.
Minister urges Iranians to shape future
Sa’ar framed the offensive as aimed at countering what he described as long-term threats to Israel while opening space for change inside Iran.
“I also tell the Iranian people they have an opportunity now. They have an opportunity to regain their freedom, which was denied by this murderous regime that repressed them so cruelly. And I hope they will be able to do it,” he said.
Sa’ar said Israel would not attempt to choose Iran’s next leadership.
“We are not, we are not intervening with who will be the next leader of Iran. That will be decided by the Iranian people themselves, hopefully in like free elections, that's the best thing that can happen,” he said.
“Our only requirement is that anyone who will be in power will not work to eliminate the state of Israel. This is enough for us,” he added.
Sa’ar confirmed that the strikes resulted in the killing of Iran’s Supreme Leader Ali Khamenei, whom he said directed repression at home and backed armed groups hostile to Israel.
“He was the supreme leader of Iran but it was a mega terrorist personally gave order for terror actions around the world,” Sa’ar said.
Sa’ar rejected criticism that the operation violates international law.
“This is totally justified by international law because international law justifies self-defense and someone who is… swearing and acting in order to eliminate another state. This state shouldn't wait until it will happen,” he said.
Duration uncertain
Sa’ar declined to predict how long the campaign would last.
“I don't want to be a prophet and to say how many days we are decisive to reach,” he said.
The Israeli military said on Sunday it would mobilize 100,000 reservists as strikes continue.
Sa’ar argued that any political shift in Iran would depend on domestic will rather than outside orchestration.
“Something is the most important thing here is connected to the will of the Iranian people. It's not something you can orchestrate from outside when you don't have a real will of the Iranian people,” he said.
