This Island Becomes Focus Amid War, Iran's "Economic Weakness"

A small Iranian island in the Persian Gulf has again become the subject of intense scrutiny amid escalating conflict in the Middle East. Kharg Island, located approximately 24 kilometres from Iran’s mainland, represents the nation’s primary oil industry hub and has thus far remained untouched by direct military attacks from the United States or Israel.

The rocky island plays a vital role in Iran’s economy as approximately 90% of the country’s crude oil exports pass through facilities located there before being transported by oil tankers through the Strait of Hormuz.

Petras Katinas, a climate, energy and defence researcher at the Royal United Services Institute, stated that controlling the island would directly impact Iran’s ability to sell oil to global markets.

“Seizing the island would cut off Iran’s oil supply route,” Katinas said. Such action could exert significant influence over the United States during future political negotiations, regardless of who holds power in Iran after the conflict concludes.

However, Katinas assessed that such operations would not be straightforward. He emphasised that capturing the island would likely require large-scale ground force operations, something the Trump administration has thus far appeared reluctant to undertake.

Tamas Varga, an oil analyst at PVM, stated that controlling Kharg Island would deal a severe blow to Iran’s economy. “If President Trump decides to seize this vital centre, it would eliminate one of Iran’s primary sources of revenue,” he said.

Nevertheless, Varga cautioned that such action could complicate the situation. He assessed that the island would remain vulnerable to drone attacks from Iranian territory itself, potentially prolonging the conflict whilst increasing uncertainty in global energy markets.

Marc Gustafson, senior director of analysis at the Eurasia Group and former head of the White House Situation Room, stated that military operations to capture the island would be extremely risky. According to him, US ground forces could become targets of Iranian drone attacks for weeks.

Meanwhile, VanEck CEO Jan van Eck referred to Kharg Island as a “critical juncture” in Iran’s energy strategy. He assessed that whoever controls the island would ultimately wield significant influence over Iran’s oil flow to global markets.

Amid mounting tensions, global oil prices surged immediately.