War fires burn towards the heart of energy! Iran and Israel strike each other's oil and gas facilities, WTI approaches $100.

As Iran and Israel engage in mutual strikes against key energy facilities in the Middle East, international oil prices have responded by rising. This conflict, which has been ongoing for nearly three weeks, further unsettles the market. In early trading on Thursday, the WTI crude oil futures contract rose by 3.4% to $98.69 per barrel. Brent crude oil closed near $107 on Wednesday, while the European natural gas benchmark prices surged by 6%. Iran launched attacks on major liquefied natural gas facilities in Qatar - one of the multiple energy targets Tehran promised to strike after the attack on the South Pars gas field. Since the outbreak of this conflict, oil prices have surged by approximately 50%. This conflict has stirred unrest throughout the Middle East - with shipping in the Strait of Hormuz being disrupted and numerous oil and gas production facilities being damaged. However, Iran's upstream energy industry had been largely unaffected prior to this, which to some extent restrained the risk of escalated conflict that could have a greater impact on long-term supplies. Reports indicate that U.S. President Trump was informed in advance of Israel's attack on the South Pars gas field, but hoped to avoid further strikes on Iran's energy facilities. Earlier this week, he had stated that targeting Iran's military objectives could still include attacking the oil infrastructure at the core export hub of Kharg Island. "The tension in the Strait of Hormuz means Trump cannot simply declare victory and pull out, as it does not resolve the root problem," said Will Todman, a senior researcher at the Middle East Program of the Center for Strategic and International Studies. "Many of Trump's options for pressuring Iran would push up energy prices, including attempting to take over Kharg Island or hitting Iran's energy production infrastructure." Qatar officials reported that the Ras Laffan Industrial City - the location of the world's largest liquefied natural gas export plant - was "severely damaged" after the missile strike. This location was one of the possible targets listed by Iran in retaliation for the attack on the South Pars gas field and related facilities. The South Pars gas field is crucial for Iran's domestic market as well as the supply to neighboring countries Iraq and Turkey. The related oil and petrochemical assets in Asalouyeh, Iran were also targeted. The UAE announced that its Habshan gas facility had temporarily halted operations due to missile interceptions causing debris to fall. On Wednesday, Iranian semi-official media reported that liquefied natural gas assets in Bahrain (which Tehran believes to be of American interest) were heavily hit by missile attacks, although the report did not specify its sources of information. Meanwhile, Trump temporarily waived the enforcement of the century-old Jones Act shipping regulations to reduce the transportation costs of oil, natural gas, and other commodities within the United States. This is his latest measure to counteract the rising energy prices resulting from a war with Iran. In order to further control the escalating fuel prices, Vice President Pence and other core officials in the Trump administration plan to hold meetings with oil industry executives on Thursday.