Israel struck Iran’s largest petrochemical complex at Asaluyeh on Monday, widening the war’s economic and strategic dimensions as both sides escalated attacks across West Asia. Defence Minister Israel Katz said the target was a key facility in the South Pars area and described the operation as a “powerful strike”, while Reuters reported explosions at the South Pars Petrochemical complex. Iranian media said utility suppliers serving the complex were hit and power to petrochemical units in Asaluyeh was cut, though the main Pars petrochemical company itself was not destroyed and damage was still being assessed. The strike matters far beyond one industrial site. South Pars is Iran’s section of the world’s largest natural gas field, shared with Qatar, and it underpins both domestic energy supply and hard-currency earnings. Associated petrochemical plants in Asaluyeh convert gas into methanol, ammonia, urea and other feedstocks used across manufacturing and agriculture. The Associated Press reported that Katz said the facility accounts for about half of Iran’s petrochemical production and, together with an earlier strike, could leave out of service sites responsible for 85% of petrochemical exports. Israeli Prime Minister Benjamin Netanyahu cast the campaign as an effort to hit what he called the Revolutionary Guards’ “money machine”.
That makes the attack both military and economic. Iran relies heavily on gas for electricity generation and household heating, and South Pars is central to that system. At the same time, sanctions and years of underinvestment have left the country short of export options such as large-scale liquefied natural gas terminals, increasing the importance of petrochemicals as a route to external revenue. AP noted that Iran exports far less raw gas than Qatar and instead uses South Pars output at home and in downstream industry. A strike on Asaluyeh therefore threatens not only export receipts but also an already strained domestic energy network, particularly if associated power, water and oxygen systems remain disrupted.
Monday’s attack also fits a wider pattern in which energy infrastructure has moved from background vulnerability to frontline target. Reuters reported that Israel had already struck South Pars in March, prompting Iranian retaliation against energy targets across the region. On April 5, Iran’s Revolutionary Guards said they had targeted petrochemical facilities in the United Arab Emirates, Kuwait and Bahrain, and warned they would intensify attacks on what they called US economic interests if strikes on civilian sites in Iran continued. That cycle has raised fears that the conflict is shifting from military attrition towards a broader contest over energy systems, industrial chokepoints and state revenues.
Market reaction has reflected those fears. Reuters reported on Tuesday that Brent crude rose above $110 a barrel and US crude topped $113 as traders weighed damage to energy infrastructure and the continued closure of the Strait of Hormuz. The waterway normally carries about a fifth of global oil flows, and the combination of disrupted shipping, missile exchanges and threats against refining and petrochemical sites has put a firm risk premium back into prices. Saudi Arabia said on Tuesday it intercepted ballistic missiles aimed at its Eastern Region, with debris falling near energy facilities, underlining how quickly the conflict has spread beyond the original battlefield and into the wider Gulf energy map.
Diplomatic pressure has done little so far to halt the slide. Reuters reported that Iran rejected a US-brokered ceasefire proposal and instead demanded a broader settlement, including safe passage arrangements through Hormuz, sanctions relief and reconstruction. President Donald Trump, in turn, threatened severe strikes on Iranian infrastructure if Tehran failed to comply by his deadline. Those threats, and Israel’s hit on the Asaluyeh complex, drew renewed warnings from the International Committee of the Red Cross, whose president said deliberate threats or attacks against essential civilian infrastructure must not become the new norm in warfare. The legal and humanitarian stakes are rising alongside the military ones.