US Strikes Iran Energy Assets, Tehran Vows Retaliation; Iran Intel Chief Killed, Trump Muses On 'Finishing Off Terror State'

US Strikes Iran Energy Assets, Tehran Vows Retaliation; Iran Intel Chief Killed, Trump Muses On 'Finishing Off Terror State' Summary Israel says Iran's intelligence chief Esmail Khatib was eliminated overnight as pace of top leadership killings accelerates. Iran says upstream oil and gas assets are under attack for first time since war began, readies retaliatory action against oil/gas assets in Gulf area, including Qatar, Saudi Arabia, & UAE Iraq reroutes some flows through Ceyhan Pipeline to Turkey Iran reiterates new rules in place for Hormuz transit as traffic remains de-minimus, sparking reports that "the blockade is now the worst disruption to oil flows ever..." Iran FM says no change in nuclear posture: vows Tehran not pursuing an atomic bomb. President Trump issues posts musing whether US should 'finish off' Iran, though Tehran signals continuity & stability of govt. *  *  *  Iran Plans Counterattack on Gulf Area Energy Infrastructure  Brent crude futures jumped from around $103.5/bbl to $108/bbl following Israeli airstrikes on Iran's South Pars gas field in the Persian Gulf. This escalation in strikes underscores what Bloomberg commodities analyst Javier Blas said: "Both sides are now targeting upstream (i.e., production) oil and natural gas assets." He asked, "Is this an attempt to escalate to de-escalate? Or is it simply a sign that escalation is spiraling out of control?" Both sides are now targeting upstream (ie, production) oil and natural gas assets. Is this an attempt to escalate to de-escalate? Or is it simply a sign that escalation is spiralling out of control? — Javier Blas (@JavierBlas) March 18, 2026 Moments ago: IRAN TO RETALIATE AGAINST ATTACK ON ENERGY INFRASTRUCTURE: FARS IRAN WILL HIT ENEMY SITES PREVIOUSLY THOUGHT TO BE SAFE: FARS The semi-official Fars news agency reports that Iran's energy infrastructure "will not go unanswered, and Iran's response will target enemy infrastructure previously thought to be safe." "These centers have become direct and legitimate targets and will be targeted in the coming hours," Iran's semi-official Tasnim news agency reports. Qatar: Ras Laffan refinery phase 1 and 2, Mesaieed Petrochemical Complex Saudi Arabia: Samref refinery, Jubail petrochemical complex UAE: Al Hosn gas field Translation: Major escalation inbound for Gulf states, with crosshairs likely on upstream energy infrastructure. "With enemy missiles hitting the Asaluyeh refinery, the pendulum of war has effectively swung from limited battles toward an 'all-out economic war'," Fars stated, adding, "As of tonight, the red lines have shifted. If the enemy believed these attacks could increase pressure on Iran to force it to back down, they have made a fatal miscalculation, for this action has placed the trump card of reciprocal retaliation squarely in Iran's hands." Qatar Foreign Ministry spokesperson Majed Al Ansari called Israel’s targeting of South Pars a "dangerous and irresponsible step."  Qatar isn't happy with Israel (and the US?). Doha is surely trying to minimize blowback from Iran: both countries share the same gasfield, which the Iranians call "South Pars" and the Qataris call "North Field" https://t.co/d3Poxf2zuC — Javier Blas (@JavierBlas) March 18, 2026 "Iran has calibrated its strikes on Gulf energy infrastructure to signal capability without triggering extended outages. That restraint has been deliberate. The question now is whether Tehran shifts from signaling to targeting critical components that could take months, if not years, to repair," stated Fernando Ferreira, the Director of the Geopolitical Risk Service at Rapidan Energy. Iranian Oil, Gas Assets Under Attack Crude oil futures are surging after Iranian state TV reported that part of the South Pars gas field in the Persian Gulf area had been hit by an airstrike. Bloomberg reports that Israel appears to be behind the air strike on Iran's energy assets.  South Pars is the backbone of Iran's gas system and part of the world’s largest natural gas field, which Iran shares with Qatar, where the same reservoir is called the North Field. Oil and petrochemical facilities in nearby Asaluyeh also came under attack, it added. An attack, if confirmed, would mark the first time Iran’s upstream oil and gas facilities have been targeted in this war. According to the Iranian oil ministry’s official news service, Shana, daily gas production at South Pars, which is shared with Qatar, reached a record 730 million cubic meters in 2025. Iranian state TV says that South Pars phases 3, 4, 5, and 6 were hit by Israeli air strikes. This suggests damage to core upstream gas infrastructure at the backbone of Iran’s energy system, marking a major escalation in Gulf energy risk Most of Iran’s gas production comes from South Pars, making it central to power generation, industrial feedstock, petrochemical production, and winter heating demand. Bloomberg noted that the gas field is the "key source of pipeline gas to Turkey via the Tabriz–Ankara line. Disruptions to those flows could force Ankara to seek more spot LNG on already tight global markets."  WTI futures quickly surged to $95/bbl on the news. Operation Epic Fury appears to have shifted toward targeting the IRGC’s funding lines. This was evident last week with strikes on the Kharg Island export hub. Iraq Reroutes Oil From Hormuz, through Ceyhan Pipeline to Turkey Brent crude futures roller-coastered, oscillating between $100 and $103 per barrel after news broke that Iraq had found an initial (though still limited) workaround for the Hormuz chokepoint by restarting exports through Turkey's Ceyhan port. Bloomberg reports that North Oil Co.'s oil pipeline to Ceyhan port, with an expected initial export capacity of 250,000 barrels, has begun operation. That is in addition to 210,000 barrels per day from Kurdistan through the northern pipeline, according to Oil Minister Hayyan Abdul Ghani. Ceyhan exports crude from the Kurdistan and Kirkuk fields (Iraq) to the Mediterranean port, effectively bypassing the chaos at the Hormuz chokepoint and in the Gulf region. Disruption of tanker flows in the critical waterway forced Iraqi oil production to plunge to about 1.4 million barrels per day, roughly one-third of pre-Hormuz closure levels. Three weeks into the US-Iran conflict, tanker activity on the waterway has slowed to a crawl, at just about 400,000 barrels per day, compared to the pre-Hormuz closure average of 14 million barrels per day. Kpler oil analyst Muyu Xu warned, "The blockade is now the worst disruption to oil flows ever. Real barrels are now disappearing from global oil markets, which can lead to demand destruction in the weeks to come." Iraq is following Saudi Arabia's playbook of shipping crude through pipelines rather than through Hormuz as IRGC drone and missile threats persist. Saudi Aramco shifted its crude flows through the East-West pipeline to export terminals at Yanbu and Al Muajjiz on the kingdom's Red Sea coast. Iran Remains In Control Of The Strait Meanwhile, Iran-linked vessels accounted for 35% of the 20 crude tankers that made outbound Hormuz transits in the first week of the conflict, according to Kpler. About a week later, that number rose to five of the eight tankers that left the region, suggesting that Iran's control of the critical waterway has significantly increased. On Tuesday, the conflict escalated further with the confirmation of the killing of Ali Larijani, secretary of Iran's Supreme National Security Council. According to Aaron Stein, president of the Foreign Policy Research Institute, "The Larijani killing is a big deal, and may make Iran more desperate to disrupt oil flows." "Trump is obviously being pressured to escort tankers, so we're in for the possibility of very tense US operations in ways I'm certain the Navy would like to avoid," Stein said. On Wednesday, Iran's Foreign Minister Abbas Araghchi told Al Jazeera about new rules that should be imposed on the critical waterway. "We need to design new arrangements for the Strait of Hormuz and the way ships pass through it in the future after the war so that peaceful navigation through this waterway can be permanently maintained under clear regulations with consideration for Iran's interests and the interests of the region," Araghchi said. He said, "It should guarantee that safe passage through the strait takes place under specific conditions," adding that conditions should "ensure peacefulness. We do not want to witness another war in the region and we do not want to see the strait closed again." Hormuz Traffic Remains Practically 'Halted' Goldman analysts, led by Yulia Zhestkova Grigsby, showed clients on Tuesday that shipping traffic through Hormuz remains down 98% from normal levels (4-day moving average). The estimated total hit to oil flows from the Persian Gulf stands at 15 mb/d, 15 times larger than the peak April 2022 hit to Russian oil production. Iranian crude exports dominate the Strait. "With no end in sight to hostilities, shut-ins rising on a daily basis, and the Strait technically closed, we remain of the view that Brent is set to remain in a new, higher $95-to-$110 range," Westpac Banking analyst Robert Rennie wrote in a note. "Were we to see a major refinery plant hit or confirmation of additional mining of the strait, we would expect that range to extend higher by another $10-$20," Rennie added. The takeaway here is that Gulf countries, such as Iraq and Saudi Arabia, are rerouting crude flows from tanker transit through the waterway to pipelines out of the hostile region, as Iran remains largely in control of the Strait, necessarily (and dramatically) reducing global energy supply (for longer).  The Strait of Hormuz situation won't return to its pre-war status. — محمدباقر قالیباف | MB Ghalibaf (@mb_ghalibaf) March 17, 2026 ...and now he is reportedly dead (among many other Iranian leaders).  Iran Intel Chief Killed In 3rd High-Level Hit More decimation of Iranian top leadership, as Israel's defense minister Israel Katz has announced Iran's intelligence chief Esmail Khatib was eliminated in an overnight strike, which marks yet another alleged high-level hit as the tempo of targeted killings accelerates. "On this day, significant surprises are expected across all arenas that will escalate the war we are conducting against Iran and Hezbollah in Lebanon," Katz warned in a military briefing, according to Israeli media. If confirmed, the reported hit would mark the third top-tier Iranian figure eliminated in just 48 hours, following Israeli strikes that reportedly killed national security chief Ali Larijani, who was likely effectively running the war, and Basij commander Gholamreza Soleimani. Iran's intelligence chief Esmail Khatib Trump Posts: Finish Them President Donald Trump posts Wednesday: I wonder what would happen if we “finished off” what’s left of the Iranian Terror State, and let the Countries that use it, we don’t, be responsible for the so called “Straight?” That would get some of our non-responsive “Allies” in gear, and fast!  Trump also said in a rapid follow-up that "We are rapidly putting them out of business!" Still, Iran is signaling continuity, not collapse, even as newspapers in America run celebratory headlines such as "Israel Is Hunting Down Iranian Regime Members in Their Hideouts, One by One." Foreign Minister Abbas Araghchi pushed back on the narrative of systemic breakdown, insisting the Islamic Republic "does not rely on a single individual." Meanwhile, unconfirmed chatter suggests parliament speaker Mohammad Bagher Ghalibaf may have narrowly survived an assassination attempt in northern Tehran. There are indicators that he too may be running the day-to-day of the government and of the wartime response; however, it's also clear the Islamic Revolutionary Guard Corps (IRGC) is firmly in control of the country. Israel Gives Military Freedom Of Elimination Strikes As a reminder of analysis we featured earlier in the conflict, "Endurance regimes do not need clean victory to change the game. They only need to survive the shock while making the old equilibrium too costly for their adversaries to restore." Journalist Jeremy Scahill, who starting over two decades ago covered the lead-up to the Iraq war from on the ground in Baghdad, has reiterated that "In asymmetric warfare, the less powerful side does not need to militarily defeat an adversary, but rather force it to a point where it determines the costs of continuing the war is too high." The US-Israeli operation is seeking to so utterly smash the country and its leadership, and potentially bring people out to the streets to topple the government, so as to avid reaching this dilemma. Israel is said to be working with spies and spotters on the ground, which Basij forces have sought to expose and arrest. Iran's Foreign Minister Abbas Araghchi on the killing of Ali Larijani: I do not know why the Americans and the Israelis still have not understood this point. The Islamic Republic of Iran has a strong political structure with established political, economic, and social… pic.twitter.com/v6cgyjaoU3 — Clash Report (@clashreport) March 18, 2026 But just as Iran is clearly trying to adapt, by reportedly allowing autonomy of command among military units in the instance of being cut off from top leadership, so is Israeli too adapting its strategy and tactics. Katz has confirmed that he and Prime Minister Benjamin Netanyahu have granted the military standing authorization to eliminate additional senior Iranian officials, with no case-by-case approval required. Or in other words, the Israeli decapitation efforts are now on autopilot, signaling greater escalation. Tehran Signals No Change in Nuclear Posture Tehran, for its part, is surprisingly signaling that it has no intention of developing a nuclear weapon. It's hard to evaluate any such official stance in the middle of a war for survival, but FM Araghchi on Wednesday reiterated that Iran's nuclear posture "won’t significantly change" - even as military leaders warn of a "decisive and regrettable" response to Israeli strikes.  Tehran holds funeral ceremony for security chief Ali Larijani and Basij chief Gholamreza Soleimani. pic.twitter.com/4sjTyzzJgj — Ihtisham Ul Haq (@iihtishamm) March 18, 2026 Nuclear sites have come under direct threat during the war, with Tuesday a projectile reportedly having near Iran’s Bushehr nuclear facility, though local officials say no damage occurred. In Washington, there's some clear doubling down militarily on the part of the Trump administration, while the question of finding an offramp is still likely being hotly debated within White House and national security circles. On the political front, the closer the US gets to Memorial Day travel with gas prices climbing higher, the more politically costly it is likely to be for Republicans. Tyler Durden Wed, 03/18/2026 - 09:45