Editor’s Note: This story has been updated to include the latest developments.
Iran warned Sunday it would strike the energy and water systems of Gulf neighbors if President Donald Trump follows through on a 48-hour ultimatum to hit Iran’s electricity grid, raising the risk of a wider regional conflict and fresh turmoil in global energy markets.
Blackouts And Oil Fears Deepen
Powerful explosions were reported across central, southern and eastern Tehran, according to Al Jazeera. The television network cited verified footage which said residents in Khorramabad, west of Tehran, reported a complete blackout in the area forced by air raids late on Sunday.
The Israeli military has issued a statement in which it admitted targeting Iranian government infrastructure, according to the report.
Meanwhile, IEA Executive Director Fatih Birol reportedly warned in an address to Australia’s National Press Club that the Middle East crisis is more severe than the two 1970s energy shocks combined, and he said reopening the Strait of Hormuz remains the biggest step toward easing the turmoil.
Tehran Threatens Gulf Energy Retaliation
Iranian military spokesman Ebrahim Zolfaqari said, and state media carried his warning that if Iran’s fuel and energy infrastructure is attacked, “all energy infrastructure, as well as information technology … and water desalination facilities” tied to the United States and its regional allies would be targeted, reported Reuters.
The threat came after Trump said Saturday the United States would “hit and obliterate” Iran’s power plants unless Tehran fully reopened the Strait of Hormuz within 48 hours, despite having suggested barely a day earlier that the war might be winding down. U.S. Marines and heavy landing craft were also heading to the region, adding to fears of further escalation.
Iran’s Revolutionary Guards said Sunday the strait would be “completely closed” if Trump carried out the threat against Iranian energy facilities. Parliament Speaker Mohammad Baqer Qalibaf also warned on X that critical infrastructure and energy facilities across the Middle East could be “irreversibly destroyed” if Iranian power plants were attacked.
Stock Futures Rise As Oil Prices Surge
That pressure has already rattled oil markets. At the time of writing, WTI crude futures rose 0.42% to $98.64 per barrel. RBOB gasoline futures surged 1.05% to $3.3207 per gallon, while ULSD heating oil futures jumped 0.63% to $4.6373 per gallon. Meanwhile, natural gas futures fell 1.74% to $3.041 per MMBtu (million British thermal units).
Stock futures were largely unchanged at the time of writing, with the Dow futures edging up 0.02% to 45,903, while S&P 500 futures slipped 0.15% to 6,549 and Nasdaq futures fell 0.23% to 24,045.75.
Image via Shutterstock/ Hamara
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