Brent crude oil futures surged on Thursday, topping $114 a barrel after a series of overnight strikes on critical infrastructure in the Persian Gulf.

European natural gas benchmarks rose by as much as 25% following reports of extensive damage to Qatar’s Ras Laffan Industrial City, the world’s largest liquefied natural gas (LNG) export hub. 

At the center of the escalation is the South Pars/North Field complex, the world’s largest gas reservoir shared by Iran and Qatar. Iranian officials confirmed that Israeli strikes on the Asaluyeh hub forced a shutdown of two processing units.

In Qatar, state energy firm QatarEnergy reported fires at Ras Laffan following retaliatory strikes by Iran. .

Traders are now pricing in long-term supply disruptions as the conflict shifts from shipping lanes to "upstream"  energy production sites. The South Pars field alone provides 70% of Iran’s domestic gas.

Escalation spread to the United Arab Emirates and Saudi Arabia, where authorities reported drone and missile activity near the Habshan gas facility and the SAMREF refinery.