What is Kharg Island? Trump weighs strike on Iran's oil hub as Gulf war heats up

As the war involving the US, Israel and Iran, now into its second week, heats up, the Trump administration is weighing options to hit Kharg Island, a tiny, but a strategically crucial oil hub of Iran that analysts say could become a decisive pressure point against Tehran, Israel-based Ynet News reported.

The small island, located about 25 km off Iran’s coast near Bushehr province, handles nearly 90 per cent of the country’s crude oil exports, making it a cornerstone of Iran’s economy and a major source of revenue for the Islamic Revolutionary Guard Corps (IRGC).

Experts say that if Washington seeks to escalate pressure beyond airstrikes, seizing or disabling Kharg Island’s oil infrastructure could deprive Tehran of one of its biggest financial lifelines. Because of its central role in global energy supply chains, any attack on the island could also send international oil prices sharply higher, making it one of the most sensitive targets in the ongoing Gulf war.

Michael Rubin, a former Pentagon adviser on Iran and Iraq, said a move to attack Kharg could significantly weaken the regime’s ability to fund its military apparatus and maintain domestic control, according to Ynet News.

Rubin said he has raised the island’s strategic significance with officials in Washington and believes discussions have circulated within the US Security Council. However, he suggested it is unclear whether the issue has reached the small group of advisers believed to influence Trump’s decisions on the Gulf war.

KHARG ISLAND'S IMPORTANCE AND PAST ATTACKS

As Iran’s economy depends heavily on oil revenues, the facilities on Kharg — including storage tanks, pipelines and tanker-loading terminals — form a crucial financial lifeline for Tehran. With its location in the Persian Gulf, the island serves as the country’s main oil export terminal.

Kharg island’s importance has grown in recent weeks. Before the US-Israeli strikes on Iran began in late February, Tehran reportedly ramped up production at Kharg, pushing output to nearly four million barrels per day, according to energy analytics firm Kpler — close to record levels and far above its usual baseline of around 1.5 million barrels a day.

Despite its significance, Kharg Island has so far remained untouched in the current war, even after Israeli strikes on Iranian fuel depots in Tehran and the Alborz region last week, marking the first attacks on the country’s energy infrastructure during the conflict.

Kharg Island has long been considered one of the Iranian regime’s most vulnerable strategic assets by its adversaries.

During the 1979 Iran hostage crisis, US President Jimmy Carter was advised that capturing the island could give Washington leverage over Tehran, but he ultimately decided against the move. In the 1980s, President Ronald Reagan ordered strikes on other Iranian offshore export facilities after Tehran mined the Strait of Hormuz, though Kharg itself was not targeted.

The island’s oil terminal was later heavily damaged during the Iran-Iraq War in the 1980s when Iraqi forces attacked the facility, but Iran quickly rebuilt it and restored operations, Politico-owned E&E News reported.

ISRAEL CALLS FOR STRIKING ISLAND, BUT THERE ARE COMPLEXITIES

Israeli opposition leader Yair Lapid recently said striking Kharg’s oil infrastructure could collapse Iran’s economy. Tehran has warned that such an attack would trigger retaliation against energy infrastructure across the region.

“Israel should destroy all of Iran’s oil fields and energy industry on Kharg Island. That would collapse Iran’s economy and bring down the regime,” Lapid wrote on X.

However, energy analysts caution that hitting Kharg Island could also send global oil prices sharply higher. With crude breaching the mark of USD 100 per barrel, the Washington-based Center for Strategic and Studies has estimated that a major disruption at the facility could push crude prices up by about USD 10 per barrel.

Delgha Katinoglu, an Iranian energy expert with the London-based Persian-language broadcaster Iran , warned that destroying Iran’s oil infrastructure could severely damage the country’s economy for years, even if the current regime collapses.

Iran earned about USD 78 billion from energy exports in 2024 despite heavy US sanctions. Katinoglu told The New York Times that crippling the country’s oil and gas facilities could make it difficult for any future government to stabilise the economy or provide basic services.

He cautioned that such destruction could ultimately undermine prospects for a democratic transition in Iran rather than help bring about political change.

WHY DIDN'T US ATTACK KHARG ISLAND?

One reason Kharg Island may not have been targeted yet is that such a move would likely require US approval due to the risk of major escalation.

US President Donald Trump is also facing political pressure at home over rising fuel prices ahead of the midterm elections, and any disruption to Iran’s oil exports could further unsettle global energy markets.

However, officials within the Trump administration have explored other options, including seizing Kharg Island and its oil infrastructure or launching commando raids to secure Iran’s enriched uranium stockpiles, Axios reported.

When asked about the possibility of such operations in an interview with ABC, Trump did not rule them out, saying, “Everything is on the table.”

For now, Kharg remains a potential flashpoint — a small island whose oil terminals could shape the economic and strategic trajectory of the ongoing Gulf war.

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