US, Israel Plan Iran Energy Strikes, 21% of Oil at Risk

The United States and Israel are preparing weekend airstrikes on Iran's energy infrastructure, a campaign that could disrupt the 21 percent of global oil trade transiting the Strait of Hormuz and reignite a war that a June truce had appeared to end.

"We consider what the U.S. media has claimed regarding potential attacks by the U.S. and the Zionist regime as a form of madness," a senior Iranian security official told the Tasnim News Agency, adding that Tehran has prepared a response plan covering Israeli infrastructure and U.S. energy facilities in the region.

CBS News, citing multiple sources, reported the two allies plan to strike power plants and refineries over Aug. 1-2, with discussions about concluding the operation before financial markets open Aug. 3 to limit the shock to the global economy. The Wall Street Journal, citing U.S. officials, said Trump has ordered new strikes "to bring Iran to its knees," beginning this weekend and continuing for several days. The two outlets differed on whether Trump has granted final approval, but both described a massive aerial bombardment as imminent.

Strikes on energy infrastructure would hit the backbone of Iran's economy — oil and gas exports are its main revenue source — and its ability to govern, a former U.S. military official told CBS. With the Strait of Hormuz handling 21 percent of global oil trade, an escalation risks a supply shock that would push crude prices higher and ripple through global supply chains.

The escalation follows a collapse in the June memorandum of understanding that ended the 40-day war fought from Feb. 28 to April 8. Disputes over control of the Strait of Hormuz resurfaced, and as Iran continued attacks on commercial vessels, Trump ordered 13 consecutive days of airstrikes starting July 11 Eastern Time. Iran struck U.S. military bases in the Middle East in response, and the two sides traded blows until Trump suspended strikes July 24, citing negotiations.

The truce broke again July 28, when Iran launched a surprise preemptive attack on a U.S. military base in Jordan. The U.S. military retaliated July 29, paused for a day, and now appears likely to resume with Israel's participation — its first direct involvement in the war since the June ceasefire.

A 10-14 Day Escalation Plan

The U.S. State Department on Aug. 1 issued broad security warnings to American citizens across the Middle East, advising them to consider leaving or prepare for rapid evacuation, and embassies in 10 countries including Egypt, Saudi Arabia, Kuwait, Jordan, Qatar, the UAE, Iraq, Oman and Israel issued similar alerts. U.S. Central Command said it deployed a CH-47 Chinook heavy-lift helicopter to the region, while a plan drafted by CENTCOM commander Gen. Michael Kurilla calls for 10-14 days of high-intensity bombing to degrade Iran's missile capability, according to people familiar with the matter.

Iran's Foreign Ministry responded Aug. 1 with a statement vowing continued resistance "until the evil of the enemy is completely eliminated," accusing the U.S. of violating the June 18 memorandum through its naval blockade of Iranian ports and merchant ships. Foreign Minister Abbas Araghchi warned U.S. forces against "any adventurous action" in calls with his Pakistani and Turkish counterparts.

Oil Risk Premium Builds

The last time the U.S. and Israel mounted a sustained campaign against Iran's energy sector, crude prices spiked and shipping insurance costs surged as tankers avoided the strait. A renewed strike on power plants and refineries would compound that pressure: Iran's oil exports, which account for the bulk of state revenue, would face immediate disruption, while any Iranian retaliation against U.S. energy facilities in the region would threaten output from Gulf producers.

Trump previewed the campaign at a cabinet meeting at Camp David, saying "we're going to hit them very hard" and warning that "at some point they are going to say, 'We can't take it anymore.'" He has previously threatened to bomb Iranian bridges and power plants for every vessel attacked in the strait. The WSJ said a diplomatic breakthrough remains difficult given deep distrust between the two sides, with Trump describing Iranian leadership to aides as "out of their minds."

If the strikes proceed, the risk premium in crude could widen sharply, pressuring airlines and energy-intensive manufacturers while lifting defense and oil-services stocks. If Trump withholds final approval — as CBS reported he has not yet given — the market could see a relief rally, but the underlying standoff over the strait leaves the region on a hair trigger.

This article is for informational purposes only and does not constitute investment advice.