As the US war with Iran continues, attention is turning to a tiny island off the coast of the Middle Eastern country.
Kharg Island, whose total area is just 7.7 square miles, is situated northwest of the strategically important shipping route, the Strait of Hormuz.
Despite its small size, the island holds around 94 per cent of the country’s crude oil for export, mostly bound for China, and its main oil export terminal.
Donald Trump said on Friday that US strikes had “obliterated” Iranian military outposts on the island, but left alone its oil infrastructure for now.
US administration officials said that discussions on seizing the key island have taken place, according to Axios. The land, which is smaller than the city of Westminster in London, could choke off Iran’s economy and leave a devastating impact for years to come.
“Seizing the island would cut off Iran’s oil lifeline, which is crucial for the regime,” Petras Katinas, research fellow in climate, energy and defence in the Europe office of the Royal United Services Institute, told The Telegraph.
“Of course, with shipping via the Strait of Hormuz now stopped, they cannot sell oil anyway, but looking ahead, seizure would give the US leverage during negotiations, no matter which regime is in power after the military operation ends.”
Shipping through the Strait has largely come to a halt after the Islamic Revolutionary Guard Corps took “complete control” of the major waterway.
Global supply chains have been severely affected and experts have warned of a devastating economic impact across the world if it continues.
Oil prices surged to more than $100 a barrel on Monday before dropping, and the IRGC warned that it could reach $200 if hostilities escalate.
“Should he take Kharg, rather than destroy it, he can not only ensure the regime can never again pay the salaries of its bureaucrats and soldiers,” former Pentagon official Michael Rubin wrote in an article for the American Enterprise Institute in January this year, before Trump’s assault.
“But also, in the future after regime change, he can ensure that the new Iranian regime can finance its own rebuilding.
“The IRGC, of course, could target Kharg with ballistic missiles, but that would sign their death warrant. Not only would Trump respond in kind, but such action would end Iranian oil exports for months to come, again leaving salaries unpaid.”
Other analysts have suggested the island could be used as a bargaining chip as oil exports make up nearly 40 per cent of Iran’s government budget.
However, it would make American and Israeli troops vulnerable to attacks by Iranian forces.
“If President Trump were to decide to seize this pivotal hub, it would deal a significant blow to the Iranian regime, as it would deprive them of a critical source of revenue,” oil analyst Tamas Varga told CNBC.
“Such a move would be reminiscent of the US intervention in Venezuela at the beginning of the year, when it effectively took control of the country’s oil sector.”
The island was previously attacked by Saddam Hussein in 1984, sparking the oil tanker war in the ongoing conflict between Iran and Iraq.
But this isn’t the first time Kharg appears to have been in Trump’s sightline. He previously made a throwaway remark about the island nearly 40 years ago while promoting his book The Art of the Deal in an interview with The Guardian.
“They’ve been beating us psychologically, making us look a bunch of fools,” he said of Iran in 1988. “One bullet shot at one of our men or ships, and I’d do a number on Kharg Island. I’d go in and take it.”
Neil Quilliam, an energy policy and foreign affairs analyst at Chatham House, told The Independent that while it is “unlikely” Trump would takeover the territory, any attempt would “likely send the markets into a tailspin”.
It could also block any future resolution between the countries, leading to an endless standoff.
“The US would effectively control Iran’s major export terminal but the Iranian leadership would remain in control of the country’s production so there would be a standoff,” he said. It could also be a “major cause for concern” for Gulf countries, setting a dangerous precedent.
“It is Iran’s Achilles heel in this war but fighting for and occupying Kharg could cause irreparable damage to the terminal and hurt any successor regime’s chances of managing the economy,” he continued. “Previous presidents have steered away from Kharg understanding its strategic important to global oil markets.”
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