US Steps Up Iran Strikes as Oil Industry Faces More Upheaval

The US and Israel are conducting their most intense day of attacks yet against Iran and won’t give up until the Islamic Republic is beaten, the Pentagon said, striking a more aggressive tone after President Donald Trump’s suggestion the war could end soon. Representative Marlin Stutzman said he expects the administration to soon request supplemental spending to pay for the war with Iran and that Republicans will over whelmingly support it as well as what a oil disruption will mean at the gas pump. “It very much feels like a market trading in the fog of war, reacting in real time as events unfold,” said Rebecca Babin, a senior energy trader at CIBC Private Wealth Group. “Traders continue to get whipsawed by intense price action and extreme volatility in crude, with headlines driving sharp intraday swings.”

The conflict in the Middle East, now into its second week, has drawn more than a dozen countries into the fray and has sparked concerns about an inflation crisis. US retail gasoline has jumped, putting additional pressure on Trump.

Saudi Arabia, Iraq, the United Arab Emirates and Kuwait have lowered their collective output by as much as 6.7 million barrels a day, or 6% of global output, Bloomberg reported on Tuesday. The biggest oil refinery in the UAE halted operations following a drone strike.

In the US, however, domestic inventories are rising. A government report Wednesday showed that US crude stockpiles rose by 3.8 million barrels last week, diverging from a closely followed industry report that had indicated a draw. Gasoline demand rose sharply, with the four-week average posting its largest increase since October 2024, in an indication that drivers are fueling up before prices climb even further. When the first cruise missiles began detonating inside Iran, the strikes had all the hallmarks of previous successful US military campaigns — unstoppable, overwhelming force delivered without warning.

But as the conflict extends toward a third week, the US war effort is showing unexpected signs of strain against an adversary whose military budget is smaller than the GDP of Vermont — but which has an arsenal of missiles and drones unlike anything the US has ever faced.

US forces have been forced to dig deep into inventories of expensive, hard-to-replace interceptors to counter the Iranian barrage. Even with the Pentagon saying Iran’s attacks are down more than 80%, hard-to-spot anti-aircraft missiles have prevented the total aerial dominance Washington is accustomed to.

“The United States led the long-range precision strike revolution, and this is the first war where we’re seeing the adversary have that kind of capability,” said Kelly Grieco, a senior fellow at the Stimson Center. “It’s putting stress on the system that we haven’t seen before.”

Tehran is still hitting valuable military installations and energy infrastructure across the Mideast daily, part of its strategy to raise oil prices to economically punishing levels. A strike in the United Arab Emirates near one of the world’s biggest oil refineries halted operations there Tuesday. The following day, the UK navy said three commercial ships had been struck by “projectiles” in the Strait of Hormuz and Persian Gulf. President Donald Trump has warned Ir

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