Where is Kharg Island and why is it key to the future of oil?

Trump and the U.S. military have attacked Kharg Island before the Tuesday deadline. Dozens of military targets have been hit according to the latest reports from the region. Some media outlets are speculating there could be ground operation after the air strikes, while others are suggesting Trump’s latest post could be a threat to use nuclear weapons against Iran.

Kharg is often described as Iran’s Achilles’ heel. The island is small, exposed, and critically important. Losing it would mean economic collapse for Iran, yet capturing and holding it would be extremely costly for any foreign power. For that reason, Kharg has become one of the most dangerous strategic points on the planet, where a single miscalculation could trigger a global energy crisis.

Located a little more than 12 miles from Iran’s shoreline in the northern Persian Gulf, the island handles the vast majority of the country’s oil exports. About 90 percent of Iran’s crude oil leaves the country through this small island. The Kharg oil terminal is managed by the National Iranian Oil Terminals Company (OTC).

The facility has a loading capacity of up to 7 million barrels per day and can receive as many as 10 oil tankers at once. Any disruption at Kharg would therefore affect not only Iran but also its main buyers, including China, the world’s largest oil importer.

Kharg is not just a point on the map. It is a highly specialized industrial complex. In addition to OTC’s facilities, the island has pipelines linking it to inland oil fields, storage depots and tanks capable of holding millions of barrels, docks for very large crude carriers (VLCCs), and air defense systems and radar installations set up by Iran.

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