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How Iran's 'Tiny' Kharg Island 'Holds' the Global Economy

Published March 14, 2026, 09:21
How Iran's 'Tiny' Kharg Island 'Holds' the Global Economy

Iran's tiny Kharg Island, through which 90% of the country's oil exports pass, has emerged as a critical geopolitical point. Despite US-Israel conflicts, the export terminal remains intact, causing concern due to the potential impact on global oil prices in the event of an attack. Experts warn that a bombing or occupation of the island could send oil prices soaring to $150 a barrel, completely disrupting Iranian exports. Kharg Island, 8 kilometers in size, is the point of arrival for pipelines from central and western Iran. Founded by the American Amoco, it was seized by Iran in 1979. Its geographical location, with deep waters near the coast, makes it ideal for serving large oil tankers. The US, despite extensive military operations within and around Iran, has so far avoided targeting oil infrastructure on Kharg. However, the disruption of tanker traffic through the Strait of Hormuz has already led to an increase in oil prices by $20 a barrel. Iran has increased the volume of oil exports through Kharg, reaching 3 million barrels per day, in anticipation of a possible attack. US President Trump had announced air strikes on targets on Kharg, but reportedly canceled them at the last minute. The geopolitical importance of the island remains critical, as maintaining its operation is vital for the stability of global energy markets.