CRUDE oil prices extended their sharp advance, climbing above US$88 a barrel on Friday after Kuwait reported that an Iranian attack had damaged a power and water desalination facility, fuelling concerns that the widening conflict could increasingly target critical infrastructure across the Gulf.
Brent crude futures, the global benchmark, rose 4.6% to settle at US$88.10 per barrel, while US West Texas Intermediate (WTI) futures gained 4.5% to close at US$82.49.
The surge marked oil’s strongest monthly level in four weeks, with prices jumping more than 14% over the week as escalating hostilities between Washington and Tehran intensified fears of a broader regional confrontation and prolonged disruption to energy supplies.
Kuwait’s Ministry of Electricity, Water and Renewable Energy said the attack caused damage to the facility and sparked a fire that affected several electricity generating units, according to The Kuwait Times.
The incident has heightened concerns over the vulnerability of civilian infrastructure in Gulf states, many of which depend heavily on desalination plants to provide essential water supplies.
Iran said it had carried out attacks against US targets in Bahrain, Jordan, Kuwait, Oman, Qatar and Syria in retaliation for Washington’s latest military operations, according to Iranian state media outlet PressTV.
The United States Central Command (Centcom) said it had completed its sixth consecutive night of strikes against Iran, hitting dozens of military sites, including logistics facilities and maritime capabilities.
Centcom said more than 50,000 US personnel were operating across the Middle East, adding that they “remain vigilant, lethal, and ready.”
The renewed escalation follows the collapse of a fragile ceasefire reached last month, reviving concerns over the security of the Strait of Hormuz, a crucial maritime corridor responsible for handling about 20% of global oil shipments.
Any prolonged disruption to the waterway could trigger higher energy costs, increased shipping expenses and renewed inflationary pressures for economies dependent on imported fuel.
Commercial traffic through the Strait of Hormuz has remained significantly restricted, while maritime risks increased after a tanker was struck by a projectile off Oman, causing minor damage, according to the United Kingdom Maritime Trade Operations Centre.
Iran has targeted commercial shipping in recent days as part of efforts to pressure vessels travelling through the strategic waterway, raising concerns that civilian maritime operations could face further disruption.
The conflict has also raised fears over the security of the Red Sea shipping route, another key artery for global trade.
Three sources told Reuters that Iran had instructed Yemen’s Houthi forces to prepare to disrupt shipping through the Red Sea if Washington launched attacks against Iranian power infrastructure.
The prospect of simultaneous threats to both the Strait of Hormuz and the Red Sea has increased concerns over wider supply chain disruptions affecting energy markets, commodities and international trade.
US President Donald Trump said in an interview with Fox News earlier this week that American forces could target Iranian infrastructure if diplomatic efforts failed to achieve a breakthrough.
Iran’s military leadership warned that any attack on its infrastructure would trigger retaliation against regional assets, with a spokesperson stating that “everything that is still intact … that is, all the infrastructure in the region – will be crushed.”
Despite the sharp escalation, analysts said a diplomatic resolution remained possible.
Jorge León, Rystad Energy’s head of geopolitical analysis, said a limited agreement between Washington and Tehran remained the most likely outcome, although confidence in that scenario had weakened as tensions continued to rise.
León said both sides still had economic incentives to prevent a complete collapse in negotiations, with the United States seeking lower oil prices ahead of November’s midterm elections and Iran reluctant to abandon potential economic relief.
“Tehran has a substantial economic package on the table, including access to frozen assets and export waivers, that it does not want to walk away from permanently,” León said in a note.
With military operations continuing and key energy routes under pressure, global oil markets remain highly sensitive to developments in the Gulf, with traders watching closely for any further attacks on infrastructure, shipping lanes or regional energy facilities that could push prices even higher. - July 18, 2026
