Iran responded by striking energy and military infrastructure in Kuwait and Bahrain over the weekend. A Kuwaiti power plant was set on fire, a water desalination facility sustained damage, and an oil site in the northern Gulf was hit. Iran’s Islamic Revolutionary Guard Corps also claimed two oil tankers exploded after attempting to transit what it described as an unsafe southern route through the strait, warning that “not a single drop of oil or gas” would pass through the waterway as long as U.S. aggression continued.
The escalation has all but frozen tanker traffic through the Strait of Hormuz, a chokepoint that typically carries about a fifth of the world’s oil and liquefied natural gas shipments during peacetime. Maritime risk data showed only 30 verified transits between July 14 and July 20, and the London Stock Exchange Group reported that only two outbound oil tankers were visible in the strait on Monday morning. Goldman Sachs told clients that its $100-per-barrel Brent scenario is “back in play,” language the bank had withdrawn during ceasefire negotiations in June.