Iran’s ‘forbidden island’: Kharg Island explained – the oil ‘crown jewel’ at the centre of US-Iran escalation

The latest US airstrikes on Iran’s Kharg Island have drawn attention to a small patch of land in the Persian Gulf that plays an outsized role in the global oil trade.

Kharg Island is not just another military location. It is the main outlet for Iran’s crude exports.

Much of the country’s oil is stored and loaded at terminals on the island before tankers carry it to international markets.

Why it matters: Kharg Island handles the bulk of Iran’s crude exports. Any disruption there could quickly affect the country’s oil revenues and ripple through global energy markets.

• The US strike targeted military facilities on the island but avoided energy infrastructure.
• US President Donald Trump said American forces had destroyed military targets on Kharg Island but deliberately spared the oil facilities.
• “The United States Central Command executed one of the most powerful bombing raids in the History of the Middle East, and totally obliterated every MILITARY target in Iran’s crown jewel, Kharg Island,” Trump said in a post on Truth Social.
• He added that oil infrastructure was not targeted “for reasons of decency.”

The big picture: Kharg Island lies about 20 miles off Iran’s southern coast in the Persian Gulf.

• Over decades, it has grown into the country’s primary oil export terminal.
• Large storage tanks cover much of the island. Pipelines bring crude from mainland oil fields, and tankers wait offshore to load shipments bound for buyers around the world.
• For Iran, the island functions as a central export gate. Damage to its facilities could sharply reduce the country’s ability to ship oil abroad.

State of play: The US strikes appear to have targeted military facilities on Kharg Island rather than the oil terminals.

• Early reports indicate the attacks hit sites linked to missile storage and naval activity in the Gulf. These installations are seen as part of Iran’s ability to threaten commercial shipping in the region.
• The attack comes as the conflict involving the United States, Israel and Iran enters its third week, with tensions across the region continuing to build.
• Energy markets have already started to react. Oil prices have been climbing in recent days as markets grow nervous that the fighting could begin to hit oil supplies from the Gulf.

Between the lines: Kharg Island lies close to the Strait of Hormuz, one of the world’s busiest oil routes.

• Tankers loading crude at the island must pass through this narrow channel before heading out toward global markets.
• That makes the island strategically sensitive. Any escalation around Kharg could quickly spill into the Strait of Hormuz.
• Iran’s Islamic Revolutionary Guard Corps (IRGC) has warned that oil shipments through the strait could be restricted during the conflict.
• Even the possibility of that has already made tanker operators more cautious about entering the region.

For now, the island’s oil terminals remain intact. But once fighting reaches a place like Kharg Island, energy markets and governments across the world start watching closely.