Energy Prices Jump After Major Gas Field in Iran Is Hit

Oil markets jolted higher Tuesday after Iran accused Israel of striking a vital gas field, and Tehran responded by putting rival Gulf energy sites on notice. Brent crude jumped more than 6% to just under $110 a barrel, and the price of natural gas rose by about 6% as traders absorbed news that Iran's South Pars gas field was hit, reports Bloomberg. Tehran's Islamic Revolutionary Guard Corps later released a list of "direct and legitimate" retaliatory targets in Saudi Arabia, the United Arab Emirates, and Qatar, all with some US ties.

The South Pars strike appears to be the most significant on an energy site since the war began, reports the New York Times, though the extent of damage was not immediately clear. Iran shares the field with Qatar, which condemned the attack as a "dangerous and irresponsible step" by Israel that threatens the world's energy security. The UAE also criticized the strike, notes the Wall Street Journal. South Pars accounts for about a third of the world's natural gas reserves. "New attacks bring the attention back to the physical supply reality of the war—curtailments in energy tighten every day," Rabobank energy strategist Florence Schmit tells Bloomberg.