Oil prices climbed on Wednesday as attacks on critical energy facilities in the Middle East intensified concerns over the widening impact of the nearly three-week-long conflict. The benchmark Brent crude futures surged by as much as 5.1%, approaching $113 per barrel, while the most actively traded WTI crude futures neared $96 per barrel. U.S. natural gas futures jumped up to 6.5%.

The price surge followed an Iranian strike on a major liquefied natural gas (LNG) site in Qatar, one of several energy assets Tehran vowed to target after its massive South Pars gas field was attacked. Since the conflict began, oil prices have skyrocketed by approximately 50%. The hostilities have caused significant disruption across the Middle East—shipping has been hampered near the Strait of Hormuz, and substantial volumes of oil and gas production have been halted.

So far, Iran’s upstream energy sector has remained largely unaffected, helping to contain escalation risks that could otherwise have severe long-term supply consequences. However, one analyst cautioned that markets are still underestimating the danger. “The market continues to undervalue the risk of a rapid escalation into direct strikes on broader Gulf energy infrastructure, and has not fully priced it in,” said Harris Khurshid, Chief Investment Officer at Karobaar Capital LP in Chicago. “If this escalates into direct strikes, then $120 per barrel would not be a ceiling but a starting point. It would not be at all surprising to see Brent reach $140 to $160 per barrel.”

U.S. President Donald Trump stated that the United States had no advance knowledge of Israel’s strike on the South Pars gas field but threatened that if Qatari assets were hit again, U.S. forces would “destroy the entire area of the gas field.” Earlier in the week, he indicated that targeting oil infrastructure on Iran’s Kharg Island—a key export hub—remained under consideration following airstrikes on military objectives there.

“The pressure on the Strait of Hormuz means Trump cannot simply declare victory and withdraw, as that would not resolve the underlying issue,” said Will Todman, a senior fellow with the Middle East Program at the Center for Strategic and International Studies. “Many of the options available to Trump to increase pressure on Iran, including attempting to seize Kharg Island or striking Iran’s energy production infrastructure, would push energy prices even higher.”

According to local authorities, Qatar’s Ras Laffan Industrial City—home to the world’s largest LNG export facility—suffered “extensive damage” after a missile strike, with a subsequent attack igniting a fire. The South Pars gas field is vital for supplying Iran’s domestic market as well as neighboring Iraq and Turkey. Related oil and petrochemical assets in Iran’s Asaluyeh were also targeted.

“A retaliatory strike on Ras Laffan is precisely the scenario the global gas market feared most after the attack on Iran’s South Pars processing facility earlier in the day,” said Tom Marzec-Manser, Head of European Gas and LNG at Wood Mackenzie Ltd. “It is not yet clear which part of the industrial city was damaged, but in any case, this will be bullish for gas prices when markets open on Thursday.”

Abu Dhabi reported that falling debris, after it intercepted missiles, forced the temporary shutdown of its Habshan gas facility. Bahrain denied reports from Iran’s semi-official Fars News Agency that an “LNG refinery” in the country had been struck.

In response to the war-driven surge in energy prices—which has widened the discount of WTI to the global Brent benchmark—RBC Capital Markets LLC suggested the U.S. might consider a crude export tax or an export ban. The discount has expanded to more than $15 per barrel.

As part of efforts to counter rising energy costs, President Trump temporarily waived shipping requirements under the century-old Jones Act to reduce the cost of transporting oil, gas, and other commodities within the United States. Meanwhile, Vice President J.D. Vance and other key Trump administration officials are scheduled to meet with oil industry executives on Thursday.