Global Energy Markets Jittery as Middle East Conflict Disrupts Key Infrastructure

June 16, 2025 05:02 PM AEST | By Team Kalkine Media

Global Energy Markets Jittery as Middle East Conflict Disrupts Key Infrastructure — Image source: Shutterstock

Gold and Oil Prices Soar

Gold has seen a notable climb, rising more than 2.4% since Friday to around US$3,433 per ounce (A$5,300), as global uncertainty pushed capital into traditional safe-haven assets. Analysts suggest gold could soon approach US$3,500 (A$5,400) if the geopolitical landscape worsens.

Meanwhile, oil prices are rising sharply amid fears of prolonged supply constraints. Market experts have speculated that crude could reach US$150 per barrel (A$232) if current conditions persist. The energy sector remains particularly sensitive to Middle East volatility, with ripple effects likely to influence pricing for weeks to come.

Investors are closely watching key energy players such as Woodside Energy Group Ltd (ASX:WDS), which may see operations and stock activity influenced by global pricing shifts and geopolitical risk premiums.

Major Energy Assets Under Attack

Iran’s critical oil and gas infrastructure has been directly targeted, most notably with missile strikes hitting the South Pars gas field – the largest of its kind globally. The facility, located off Iran’s southern Bushehr province, contributes the majority of Iran's natural gas output. Following the strike, a significant fire forced the suspension of production operations.

As a major OPEC member, Iran’s contribution of 3.3 million barrels per day of crude oil and 1.3 million barrels per day of condensates and other liquids plays a pivotal role in global energy supply. Disruptions to these volumes could lead to further market tightness, with implications for companies such as Santos Ltd (ASX:STO), which are exposed to global LNG trade dynamics.

Strategic Sites and Refineries Damaged

In retaliation, Iran launched missile strikes on Israel, damaging the Bazan oil refinery and associated pipelines. These attacks raise new concerns over operational resilience in the region and the vulnerability of strategic assets. Furthermore, Iran has issued warnings of possible disruptions in the Strait of Hormuz, a critical channel for transporting liquefied natural gas and crude oil.

Australian energy infrastructure firms, such as Ampol Ltd (ASX:ALD), could face downstream effects if transportation routes are compromised, adding layers of complexity to procurement and pricing strategies.

Nuclear Facilities in the Crosshairs

Adding to the tension, Israel has reportedly intensified efforts to neutralize Iran’s nuclear program. Strikes on facilities in Natanz, Isfahan, and Fordow, along with reported casualties among senior nuclear scientists, suggest a new dimension to the conflict. Satellite imagery indicates substantial damage in at least two of these locations.

As these geopolitical dynamics evolve, stakeholders across the energy, commodities, and industrial sectors are likely to remain alert to potential knock-on effects across production, transport, and pricing ecosystems.

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