On February 28, the United States Central Command announced the launch of "Operation Epic Fury" under the directive of the U.S. President. U.S. and allied forces began strikes at 1:15 AM Eastern Time, targeting facilities of Iran's security apparatus, with priority given to locations posing immediate threats. The commander of U.S. Central Command stated, "The President issued a bold directive, and our personnel are answering the call." Reports indicate this strike against Iran was the largest in the history of the Israeli Air Force, involving over 200 aircraft and hundreds of bombs dropped on approximately 500 targets. This preemptive joint U.S.-Israel strike on February 28 has pushed the fate of Iran, or more precisely the regime led by the confirmed deceased Ayatollah Khamenei, into a critical situation. The impact of this military action is greater than the 12-day Iran-Israel war in June 2025, and whether the Iranian regime will be overthrown is now at a decisive moment.
For oil prices, market panic is expected to exceed levels seen in June 2025. A significant price surge on Monday is considered certain, with initial estimates suggesting Brent crude could surpass $80 per barrel. The duration of high prices and further upside potential will depend on the intensity of subsequent U.S.-Israel strikes against Iran and Iran's resistance. If the conflict intensity exceeds expectations, or if disruptions to the Strait of Hormuz last longer than market forecasts, extreme scenarios could see oil prices reaching $90 or even above $100 per barrel.
The status of the Strait of Hormuz remains officially open, but practical navigation for oil tankers entering or leaving the Persian Gulf has been suspended, halting cargo flow. Earlier reports suggested Iran had closed the strait, though Iranian authorities have not issued an official statement. Iran's Tasnim News Agency reported the strait is "effectively" closed, with the Islamic Revolutionary Guard Corps warning ships of dangers and advising against passage. The IRGC has issued radio warnings to commercial vessels declaring the Strait of Hormuz "unsafe." Several major traders subsequently announced suspensions of oil shipments through the strait, while insurers urgently canceled or significantly adjusted policy terms. Market analysts warn that even harassment or seizure of tankers—low-intensity friction short of a full blockade—could be sufficient to raise global shipping costs and amplify oil supply concerns. An oil tanker was reportedly attacked and sunk near the strait on March 1.
The strategic importance of the Strait of Hormuz lies in its role as the world's most critical energy export channel, handling approximately one-fifth of global daily oil consumption. It has long been a key strategic leverage point for Iran against international pressure. Historically, Tehran has used asymmetric tactics such as fast boats, drones, and missiles to intimidate shipping, increasing regional risks without triggering open conflict, thereby demonstrating its ability to influence global energy market stability, though it has never fully blockaded the strait. However, following the targeted killing of Supreme Leader Khamenei, the possibility of extreme Iranian responses has increased. While Iran has stated it does not intend to blockade the Strait of Hormuz, it has emphasized that if its energy facilities are attacked, oil and gas infrastructure of all regional countries could be destroyed. In response, the Gulf Cooperation Council issued a statement demanding Iran immediately cease attacks to ensure supply chain security and global energy market stability.
Statistics show that the combined daily crude oil production of the eight Gulf countries reliant on the Strait of Hormuz (Iran, Iraq, Kuwait, Saudi Arabia, Bahrain, Qatar, the UAE, and Oman) in 2025 was approximately 25.61 million barrels per day, accounting for about 24.5% of global daily crude output (approximately 104.4 million barrels). Daily crude exports through the strait in 2025 averaged about 14 million barrels (with estimates ranging from 13 to 14.6 million barrels per day), representing roughly one-third (approximately 31%-34%) of global seaborne crude exports; about 75% of these exports were destined for Asian markets. In 2025, Middle Eastern natural gas exports accounted for about 42% of global gas trade (primarily LNG), with a significant portion transported via the Strait of Hormuz (21% of global LNG trade).
The navigational safety of the Strait of Hormuz holds irreplaceable strategic significance for China's energy supply stability and is deeply linked to core interests in Chinese fossil fuel imports. According to relevant statistics, China is a major global importer of fossil fuels, with total imports reaching $442.5 billion in 2025. Imports from the eight Gulf nations (Saudi Arabia, Iran, Iraq, Kuwait, the UAE, Qatar, Oman, and Bahrain) amounted to $160 billion, accounting for 36.2% of the total. The transport of these energy resources is entirely dependent on the Strait of Hormuz, making it a critical hub connecting China to Gulf fossil fuel producers, underscoring its strategic importance. Data indicates China's crude oil imports reached 578 million tons in 2025, with 245 million tons transported via the Strait of Hormuz, constituting 42% of imports. Factoring in unreported crude imports from Iran, the proportion of crude oil reaching China through the strait is estimated to rise to 56%. Furthermore, China's LNG imports are highly dependent on the strait and surrounding Gulf producers. Customs data shows China imported 68.43 million tons of LNG in 2025, with 21.7 million tons sourced from Qatar, Oman, and the UAE, accounting for 31% of imports and setting a new record. Additionally, the Middle East is a major source for China's imports of naphtha, fuel oil, methanol, LPG (propane and butane), petroleum asphalt, and petroleum coke.
The ultimate trajectory of the conflict will determine the extent of oil price movements. Details compiled from various reports regarding the death of Iran's Supreme Leader Khamenei in a U.S.-Israel strike reveal vulnerabilities in Iran's defenses. Reports suggest Israeli and U.S. military intelligence had been awaiting a "rare opportunity"—a meeting involving Iran's senior political and military leadership—to eliminate them simultaneously. The key variable was the simultaneous gathering of the Supreme Leader, the President, and senior military commanders in one location. This opportunity arose on Saturday. After months of intelligence gathering, thousands of hours of surveillance and signal interception—whether through advanced technology or Iranian informants—the U.S. and Israel identified three such meetings occurring that day and seized the chance, launching a daytime strike. Approximately 30 bombs were dropped on Khamenei's residence, resulting in the near-total elimination of senior Iranian officials. Previous Israeli strikes on Iran had occurred at night—the June 2025 attack was launched in darkness, and the October 2024 strike happened after midnight. Iran's entire air defense strategy was based on the assumption that Israel would attack at night. The choice of a daytime strike clearly caught Iran off guard. Furthermore, the strike occurred during negotiations, highlighting a pattern of Iranian vulnerability to such tactics.
Regarding Khamenei's death, U.S. President Trump stated he believes the U.S.-Israel strike was effective and could create opportunities for diplomacy. "Obviously, it's much easier now than it was a day ago," Trump said when asked about the potential for a diplomatic resolution, "because they were hit very hard." Trump expressed confidence in the results achieved, emphasizing that Iran's new leadership desires dialogue, which he is open to pursuing. Current reports indicate three U.S. military personnel died in the operation. President Trump stated U.S. forces will continue bombing Iran until objectives are met, while acknowledging "there may be more" American casualties. European nations not involved in the initial strike are now engaging. The leaders of France, the UK, and Germany issued a joint statement two days into the conflict, expressing shock at Iran's "indiscriminate and disproportionate" missile attacks. They agreed to cooperate with the U.S. and all Middle Eastern allies on the matter, noting that related measures may include necessary and proportionate defensive actions to destroy Iran's capability to launch missiles and drones, preventing attacks at their source.
Following the death of Supreme Leader Khamenei, the Iranian government issued a statement vowing to "make the enemy pay a heavy price" with "full strength and determination." The statement announced 40 days of national mourning and a seven-day suspension of public institutions. It declared, "With immense grief," that Khamenei was martyred in the U.S.-Israel attack, stating "this heinous crime will be severely punished" and "we will use all our power and resolve to make the perpetrators and masterminds pay a painful price." After Khamenei's death, Ali Larijani, a highly influential figure and Secretary of Iran's Supreme National Security Council, vowed to "pierce the heart" of America. The Islamic Revolutionary Guard Corps pledged "severe" and "decisive" punishment against the U.S. and Israel, announcing that the "most fierce" offensive operations against Israeli and U.S. bases are imminent. The IRGC has already launched the ninth wave of "True Promise 4," involving large-scale missile and drone attacks on Israeli and U.S. military bases in the region. According to their announcements, 27 U.S. bases in the region, as well as the Israeli military headquarters in Hakirya and large defense industrial parks in Tel Aviv, were targeted. Recent updates suggest that despite the loss of Khamenei and 40 other high-ranking officials, Iran's collective leadership mounted an efficient military counterattack, indicating the country may not be as vulnerable as perceived.
Regarding risk assets, markets widely anticipate that the U.S.-Israel strike on Iran will trigger global risk aversion, leading to significant price increases for gold and other precious metals. However, it is noteworthy that gold prices, after rising on February 28, experienced a sharp decline on March 1. Some analysts suggest Khamenei's death has altered short-term market expectations, leading to views that the Iranian situation might stabilize quickly. If it is further confirmed that Iran can achieve a smooth political transition following Khamenei's death, capital markets could see a comprehensive reversal of expectations, potentially leading to declines in both gold and oil prices.
Compared to its impact on precious metals, the U.S.-Israel strike on Iran has a more direct effect on crude oil supply and demand. A significant surge in international oil prices on Monday is inevitable, with weekend OTC indications pointing to a sharp rise, though volatile trading cannot be ruled out. Brent crude is expected to surpass $80 per barrel. The subsequent trajectory and range of oil prices will depend on whether the faltering Islamic Republic of Iran undergoes regime change as swiftly as its leader was eliminated, and on the conflict's duration. Based on Iran's resistance and statements over the past two days, there are no immediate signs of compromise. This implies that geopolitical risk premiums are unlikely to dissipate quickly and仍有上升空间, but the situation remains fluid, requiring continuous monitoring. Market participants are advised to strengthen risk control and exercise caution.
