Oil slips as Israel-Iran strikes spare key energy infrastructure

Oil prices edged down today, paring back Friday's 7% surge, as renewed military strikes by Israel and Iran over the weekend left oil production and export facilities unaffected.
Brent futures were down 93 cents, or around 1.3%, to $73.30 a barrel this afternoon, while US WTI futures were off 99 cents or nearly 1.4%, to $71.99.
Both benchmarks jumped more than $4 a barrel in Asian trading before giving back gains. They settled 7% higher on Friday, having surged more than 13% during the session to their highest levels since January.
"It all boils down to how the conflict escalates around energy flows," said Harry Tchilinguirian, group head of research at Onyx Capital Group. "So far, production capacity and export capacity have been spared and there hasn't been any effort on the part of Iran to impair flows through the Strait of Hormuz."
Iranian missiles struck Israel's Tel Aviv and the port city of Haifa today, destroying homes and fuelling concerns among world leaders at this week's G7 meeting that the conflict could widen.
An exchange of strikes between Israel and Iran on Sunday resulted in civilian casualties, with both militaries urging civilians on the opposing side to take precautions against further attacks.
Some gas infrastructure has been hit. Iran partially suspended gas production at its South Pars field after an attack by Israel on Saturday. The gas it produces is consumed domestically. Last week, Israel shut down its offshore Leviathan gas field preemptively.
A key question is whether the conflict will lead to disruption in the Strait of Hormuz.
About a fifth of the world's total oil consumption, or some 18 to 19 million barrels per day of oil, condensate and fuel, passes through the strait.
While markets are watching for potential disruption to Iranian oil production due to Israel's strikes on energy facilities, heightened fears over a Strait of Hormuz blockade could sharply lift prices, said Toshitaka Tazawa, an analyst at Fujitomi Securities.
Iran, a member of the Organization of the Petroleum Exporting Countries, currently produces around 3.3 million bpd and exports more than 2 million bpd of oil and fuel.
The spare capacity of OPEC+ oil producers to pump more to offset any disruption is roughly equivalent to Iran's output, according to analysts and OPEC watchers.
"If Iranian crude exports are disrupted, Chinese refiners, the sole buyers of Iranian barrels, would need to seek alternative grades from other Middle Eastern countries and Russian crudes," Richard Joswick, head of near-term oil analysis at S&P Global Commodity Insights, said in a note.
"This could also boost freight rates and tanker insurance premiums, narrow the Brent-Dubai spread, and hurt refinery margins, particularly in Asia," Joswick added.
China's crude oil throughput declined by 1.8% in May from a year earlier to the lowest level since August, official data showed today, as maintenance at both state-owned and independent refineries curbed operations.
US President Donald Trump said on Sunday he hoped Israel and Iran could broker a ceasefire, but added that sometimes countries had to fight it out first. Trump said the US would continue to support Israel but declined to say if he had asked the U.S. ally to pause its strikes on Iran.
German Chancellor Friedrich Merz said he hoped a meeting of the Group of Seven leaders convening in Canada would reach an agreement to help resolve the conflict and keep it from escalating.
Meanwhile, Iran has told mediators Qatar and Oman that it is not open to negotiating a ceasefire while under Israeli attack, an official briefed on the communications told Reuters on Sunday.

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Irish Examiner

an hour ago

• Irish Examiner

US strikes three Iranian nuclear sites

President Donald Trump said that the United States military struck three sites in Iran, directly joining Israel's effort to decapitate the country's nuclear programme in a risky gambit to weaken a longtime foe amid Tehran's threat of reprisals that could spark a wider regional conflict. Iran's state-run IRNA news agency, quoting a provincial official, confirmed attacks on Fordo, Isfahan and Natanz nuclear sites. The decision to directly involve the US in the war comes after more than a week of strikes by Israel on Iran that have moved to systematically eradicate the country's air defences and offensive missile capabilities, while damaging its nuclear enrichment facilities. US and Israeli officials have said that American stealth bombers and the 30,000-pound (13,500-kg) bunker buster bomb they alone can carry offered the best chance of destroying heavily-fortified sites connected to the Iranian nuclear programme buried deep underground. 'We have completed our very successful attack on the three Nuclear sites in Iran, including Fordow, Natanz, and Esfahan,' Mr Trump said in a post on social media. 'All planes are now outside of Iran air space. A full payload of BOMBS was dropped on the primary site, Fordow. All planes are safely on their way home.' Mr Trump added in a later post that he would address the national audience at 10pm eastern time, writing: 'This is an HISTORIC MOMENT FOR THE UNITED STATES OF AMERICA, ISRAEL, AND THE WORLD. IRAN MUST NOW AGREE TO END THIS WAR. THANK YOU!' Trump said B-2 stealth bombers were used but did not specify which types of bombs were dropped. The White House and Pentagon did not immediately elaborate on the operation. The strikes are a perilous decision for the US as Iran has pledged to retaliate if it joined the Israeli assault, and for Mr Trump personally, having won the White House on the promise of keeping America out of costly foreign conflicts and scoffed at the value of American interventionism. Trump told reporters on Friday that he was not interested in sending ground forces into Iran, saying it's 'the last thing you want to do.' He had previously indicated that he would make a final choice over the course of two weeks, a timeline that seemed drawn out as the situation was evolving quickly. Iran's Supreme Leader Ayatollah Ali Khamenei warned the United States on Wednesday that strikes targeting the Islamic Republic will 'result in irreparable damage for them'. Iranian foreign ministry spokesman Esmail Baghaei declared 'any American intervention would be a recipe for an all-out war in the region'. Trump has vowed that he would not allow Iran to obtain a nuclear weapon and he had initially hoped that the threat of force would bring the country's leaders to give up its nuclear program peacefully. Israel 's military said Saturday it was preparing for the possibility of a lengthy war, while Iran's foreign minister warned before the U.S. attack that American military involvement 'would be very, very dangerous for everyone.' The prospect of a wider war threatened, too. Iranian-backed Houthi rebels in Yemen said they would resume attacks on U.S. vessels in the Red Sea if the Trump administration joins Israel's military campaign. The Houthis paused such attacks in May under a deal with the US. The US ambassador to Israel announced the US had begun 'assisted departure flights,' the first from Israel since the Hamas-led attack on October 7, 2023, that sparked the war in Gaza. White House press secretary Karoline Leavitt said at Thursday's press briefing that Trump had said: 'I will make my decision whether or not to go within the next two weeks.' Instead, the U.S. president struck just two days later. Trump appears to have made the calculation — at the prodding of Israeli officials and many Republican lawmakers — that Israel's operation had softened the ground and presented a perhaps unparalleled opportunity to set back Iran's nuclear program, perhaps permanently. The Israelis say their offensive has already crippled Iran's air defences, allowing them to already significantly degrade multiple Iranian nuclear sites. But to destroy the Fordo nuclear fuel enrichment plant, Israel appealed to Trump for US bunker-busting bomb, which uses its weight and sheer kinetic force to reach deeply buried targets and then explode. The penetrator is currently only delivered by the B-2 stealth bomber, which is only found in the American arsenal. The bomb carries a conventional warhead, and is believed to be able to penetrate about 200 feet (61 meters) below the surface before exploding, and the bombs can be dropped one after another, effectively drilling deeper and deeper with each successive blast. The International Atomic Energy Agency has confirmed that Iran is producing highly enriched uranium at Fordo, raising the possibility that nuclear material could be released into the area if the GBU-57 A/B were used to hit the facility. Previous Israeli strikes at another Iranian nuclear site, Natanz, on a centrifuge site have caused contamination only at the site itself, not the surrounding area, the IAEA has said. Mr Trump's decision for direct US military intervention comes after his administration made an unsuccessful two-month push — including with high-level, direct negotiations with the Iranians — aimed at persuading Tehran to curb its nuclear programme. For months, Mr Trump said he was dedicated to a diplomatic push to persuade Iran to give up its nuclear ambitions. And he twice — in April and again in late May — persuaded Israeli Prime Minister Benjamin Netanyahu to hold off on military action against Iran and give diplomacy more time. The US in recent days has been shifting military aircraft and warships into and around the Middle East to protect Israel and US bases from Iranian attacks. All the while, Mr Trump has gone from publicly expressing hope that the moment could be a 'second chance' for Iran to make a deal to delivering explicit threats on Mr Khamenei and making calls for Tehran's unconditional surrender. 'We know exactly where the so-called 'Supreme Leader' is hiding,' Mr Trump said in a social media posting. 'He is an easy target, but is safe there – We are not going to take him out (kill!), at least not for now.' The military showdown with Iran comes seven years after Mr Trump withdrew the US from the Obama-administration brokered agreement in 2018, calling it the 'worst deal ever'. The 2015 deal, signed by Iran, US and other world powers, created a long-term, comprehensive nuclear agreement that limited Tehran's enrichment of uranium in exchange for the lifting of economic sanctions. Mr Trump decried the Obama-era deal for giving Iran too much in return for too little, because the agreement did not cover Iran's non-nuclear malign behaviour. Mr Trump has bristled at criticism from some of his Maga faithful, including conservative pundit Tucker Carlson, who have suggested that further US involvement would be a betrayal to supporters who were drawn to his promise to end US involvement in expensive and endless wars.

Irish Independent

2 hours ago

• Irish Independent

‘Prolonged campaign' could be on the cards for Israelis as Iranian nuclear research facility is hit

Iranians hit back with missile strikes, while US begins 'assisted departure flights' from Israel Today at 21:30 Israel's military said yesterday it was preparing for the possibility of a lengthy war, and announced it struck an Iranian nuclear research facility overnight while also killing three senior Iranian commanders in targeted attacks. The prospect of a wider war was also threatened. Iranian-backed Houthi rebels in Yemen said they would resume attacks on US vessels and warships in the Red Sea if the Trump administration joins Israel's military campaign against Iran. The Houthis paused such attacks last month under a deal with the US.

Irish Daily Star

2 hours ago

• Irish Daily Star

Trump announces attacks on Iranian nuclear sites as US joins Israel-Iran conflict

President Donald Trump announced Saturday that the U.S. military struck three sites in Iran, as America joins Israel's conflict against Iran. The decision to directly involve the U.S. comes after more than a week of strikes. The U.S. joined the conflict on the side of Israel, which had hoped to destroy Iran's nuclear program once and for all. The repercussions from the strikes could be dire — a much wider regional conflict could be on the horizon. Israel had also been working to destroy the country's air defenses and offensive missile capabilities. "We have completed our very successful attack on the three Nuclear sites in Iran, including Fordow, Natanz, and Esfahan," Trump wrote on Truth Social on Saturday. "All planes are now outside of Iran air space. A full payload of BOMBS was dropped on the primary site, Fordow. All planes are safely on their way home." "Congratulations to our great American Warriors. There is not another military in the World that could have done this. NOW IS THE TIME FOR PEACE! Thank you for your attention to this matter," he concluded. He later added that he would be addressing the nation at 10 p.m. EDT to discuss the attacks. Israeli officials previously said that American stealth bombers and a 30,000-pound bunker buster bomb that only the U.S. has offered the best chance of destroying heavily fortified sites connected to Iran's nuclear program. They were buried deep underground. Israel's military warned on Saturday that it's ready for a lengthy war with Iran, as the U.S. military was seen moving multiple B-2 bombers westward. Iran's foreign minister said on Saturday that U.S. military involvement in the conflict "would be very, very dangerous for everyone," and the prospect of a wider war has many worried. Iran's Supreme Leader, Ayatollah Khamenei, added that the U.S. striking Iran could "result in irreparable damage for them." The Houthis said on Saturday that "Washington must bear the consequences for the attacks." They said previously that they would continue attacks on American ships in the Red Sea if the country attacked Iran. Rep. Thomas Massie (R-W.V.) slammed the bombing and penned on X, "This is not constitutional." The U.S. ambassador to Israel, Mike Huckabee, warned that the U.S. had already begun "assisted departure flights" from Israel for the first time since the invasion by Hamas on Oct. 7, 2023, which sparked the Israeli retaliation in Gaza. Israel's military said it struck an Iranian nuclear research facility overnight and killed three senior Iranian commanders in pursuit of its goal to destroy Iran's nuclear program. That came just over a week after two other very similar strikes. In Isfahan, where Iran's primary nuclear facility is, smoke could be seen rising near a mountain. The province's deputy governor for security affairs, Akbar Salehi, confirmed that Israeli strikes damaged the facility, according to The Associated Press. The International Atomic Energy Agency confirmed the attack as well and said it was the same facility targeted over a week ago on the war's first day. It was "extensively damaged," but there isn't any risk of off-site contamination — which is the reason attacking nuclear facilities is prohibited under the Geneva Convention and considered a war crime. It's not clear if that has changed following the U.S.'s strikes on the facilities. Iran retaliated by launching drones and missiles at Israel, but there were no reports of any significant damage. Iran hasn't yet officially acknowledged Saturday's attacks from the U.S. According to an Israeli military official, the Israeli military has taken out over 50% of Iran's launchers. "We're making it harder for them to fire toward Israel," he said. Israeli military chief spokesman Brig. Gen. Effie Defrin later said Chief of Staff Lt. Gen. Eyal Zamir told the army to prepare for a "prolonged campaign" against Iran. US military moves B-2 bombers west The B-2 bombers that appeared to be moving west took off from Whiteman Air Force Base in Missouri on Friday night, according to flight tracking data obtained and reviewed by CNN . On Saturday, the planes were flying over the Pacific, and they appeared to be headed toward Guam. B-2 bombers are the only planes capable of carrying the Massive Ordinance Penetrator, which experts highlighted as the only type of bomb that could potentially destroy Iran's secretive underground Fordow nuclear facility, which is located a couple of hundred miles east of Tehran. Israel's strikes have so far impacted the facility in Natanz in the Isfahan province, but they haven't been able to reach the Fordow facility. It's also believed that only the American bombs can penetrate or do any sort of significant damage to the facility and that none of the weapons Israel has are adequate. Each B-2 bomber can reportedly carry two of the "bunker buster" bombs, which each weigh 30,000 pounds. Trump spent the majority of last week in the Situation Room, reportedly reviewing attack plans and quizzing officials about the potential consequences of each one. The president indicated a two-week timeline for a decision on whether or not to involve the U.S. military in the conflict between Israel and Iran. Saturday seemed to be the day he made his decision, involving the U.S. in the conflict.