Iran has intensified its attacks on the United Arab Emirates’ energy and transport infrastructure, causing fires at the Shah gas field and Fujairah Oil Industry Zone, and striking a tanker near the Strait of Hormuz, according to Abu Dhabi authorities and the Fujairah government's media office. No injuries were reported from these incidents, but operations at the Shah gas field remained suspended on Tuesday following the drone attack, which caused a fire at the facility. The Shah gas field, operated by ADNOC and Occidental Petroleum Corp., has the capacity to produce 1.28 billion standard cubic feet of gas per day and 4.2 million tons of sulfur per year [2]. The Fujairah Oil Industry Zone, a critical hub for UAE crude exports and bunkering operations, also faced a fire due to a drone strike, with no casualties reported. Fujairah has experienced repeated attacks in recent weeks, highlighting the vulnerability of the UAE's only export route that bypasses the Strait of Hormuz [2].
Shipping traffic through the Strait of Hormuz, a vital energy chokepoint, has largely halted since the U.S. and Israel launched strikes against Iran on February 28. Iran has retaliated by targeting ships attempting to transit the corridor, with several incidents reported recently. A tanker was struck by an unknown projectile about 23 nautical miles east of Fujairah in the Gulf of Oman, causing minor structural damage but no injuries [2]. The Abu Dhabi Crude Oil Pipeline (ADCOP), spanning 248 miles from Habshan to Fujairah, is estimated to handle 1.5 million barrels per day, with a total capacity close to 1.8 million barrels per day [2].
WTI oil prices have surged more than 3% to around $96.10 per barrel during European trading hours on Tuesday, recovering losses from the previous session. The price rally is attributed to renewed supply concerns as the Strait of Hormuz remains largely shut and US allies resist deploying warships to escort tankers through the chokepoint. Middle East crude benchmarks have climbed to record highs, becoming the most expensive globally, with traders citing tightening supply as the main driver [1]. Despite the earlier rally, WTI prices dropped more than 4.25% on Monday after several tankers safely transited the Strait of Hormuz over the weekend, raising hopes for a potential reopening. India is negotiating for additional vessels, and several nations are engaging in back-channel talks with Iran to secure safe passage. The US continues to allow Iran to ship crude through Hormuz, and reports suggest a direct communication channel between Washington and Tehran has been activated [1].
Most countries have resisted US President Donald Trump's call to send naval escorts through the strait, drawing criticism from the president, who accused Western allies of ingratitude after years of support [1].
CONCLUSION
Iranian drone attacks on UAE energy infrastructure and the effective shutdown of the Strait of Hormuz have driven WTI oil prices sharply higher, reflecting heightened supply concerns and global energy crisis fears. The situation remains volatile, with ongoing negotiations and back-channel talks aiming to secure safe passage for tankers. Market participants are closely watching developments, as prolonged disruptions could further impact oil prices and global energy supply.