Iran threatens to retaliate against Gulf energy, water after Trump ultimatum

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TEL AVIV/JERUSALEM/WASHINGTON – Iran said on March 22 that it would strike the energy and water systems of its Gulf neighbours in retaliation if US President Donald Trump follows through with a threat delivered a day earlier to hit Iran’s electricity grid in 48 hours, escalating the three-week-old war.

The prospect of tit-for-tat strikes on civilian infrastructure could further rattle global markets when they reopen on the morning of March 23, and threaten the livelihoods of millions of civilians in the region who rely almost exclusively in some cases on desalination plants for water.

After more than three weeks of heavy US and Israeli bombardment that officials say has sharply reduced Iran’s missile capabilities, Tehran continues to demonstrate the ability to carry out attacks.

Air raid sirens sounded across parts of northern and central Israel, including in Tel Aviv, and the occupied West Bank overnight on March 22, warning of incoming missiles from Iran.

Hours earlier, the Israeli military said it had completed a wave of strikes on Tehran that targeted a military base as well as weapons production and storage facilities.

Mr Trump issued his warning on the evening of March 21, less than a day after signalling that the US might be considering winding down the conflict, even as US Marines and heavy landing craft are heading to the region.

“If Iran’s fuel and energy infrastructure is attacked by the enemy, all energy infrastructure, as well as information technology... and water desalination facilities, belonging to the US and the regime in the region will be targeted pursuant to previous warnings,” Iranian military spokesman Ebrahim Zolfaqari said, according to state media.

But while attacks on electricity could hurt Iran, they would be potentially catastrophic for its Gulf neighbours, which consume around five times as much power per capita.

Electricity makes their gleaming desert cities habitable, in part by powering the desalination plants that produce all of the water consumed in Bahrain and Qatar. Such plants use seawater to meet more than 80 per cent of drinking water needs in the United Arab Emirates, and 50 per cent of the water supply in Saudi Arabia.

Iran’s Parliament Speaker Mohammad Baqer Qalibaf doubled down, writing on social media platform X that critical infrastructure and energy facilities in the Middle East could be “irreversibly destroyed” should Iranian power plants be attacked.

Iran’s powerful Revolutionary Guards said this would also mean that the shipping lane where a fifth of global oil and liquefied natural gas normally transits along Iran’s southern coast would remain shut.

“The Strait of Hormuz will be completely closed and will not be opened until our destroyed power plants are rebuilt,” the Guards said in a statement.

More than 2,000 people have been killed in the war that the US and Israel launched on Feb 28, which has upended markets, spiked fuel costs, fuelled global inflation fears, and convulsed the post-war Western alliance.

‘Ticking time bomb of elevated uncertainty’

“President Trump’s threat has now placed a 48-hour ticking time bomb of elevated uncertainty over markets,” said IG market analyst Tony Sycamore, who expects stock markets to fall when they reopen on March 23.

Oil prices jumped on March 20, ending the day at their highest level in nearly four years.

Iranian attacks have effectively closed the Strait of Hormuz, causing the worst oil crisis since the 1970s. Its near-closure sent European gas prices surging as much as 35 per cent last week.

“If Iran doesn’t fully open, without threat, the Strait of Hormuz, within 48 hours from this exact point in time, the United States of America will hit and obliterate their various power plants, starting with the biggest one first!” Mr Trump posted on social media around 7.45pm Eastern Daylight Time on March 21 (7.45am on March 22, Singapore time).

Iranian media quoted the country’s representative to the International Maritime Organisation as saying that the strait remains open to all shipping except vessels linked to “Iran’s enemies”.

Mr Ali Mousavi said passage through the waterway was possible by coordinating security and safety arrangements with Tehran.

Ship-tracking data shows some vessels, such as Indian-flagged ships and a Pakistani oil tanker, have negotiated safe passage through the strait. But the vast majority of ships have remained holed up inside.

The US and Israel say they have seriously degraded Iran’s ability to project force beyond its borders with their three weeks of intensive air strikes.

But Tehran fired its first known long-range ballistic missiles with a range of 4,000km on March 20 towards a US-British Indian Ocean military base, expanding the risk of attacks beyond the Middle East.

Early on March 22, Iranian strikes on two southern Israeli towns injured dozens in what an Israeli hospital described as a major casualty event.

The towns were located close to Israel’s secretive nuclear reactor and a number of military installations, including Nevatim Air Base, one of the country’s largest.

Israel expects ‘weeks more of fighting’

The war has been taking place alongside a confrontation on a separate front between Israel and Lebanon’s Hezbollah, backed by Iran, with Israel saying on March 22 that its troops had raided a number of the armed group’s sites in southern Lebanon.

Israeli military spokesman Brigadier-General Effie Defrin told reporters that Israel continues to hit Iran non-stop and expects “weeks more of fighting against Iran and Hezbollah”.

Hezbollah said it had attacked several border areas in northern Israel. Israeli emergency services said one person was killed in a kibbutz near the border. Israel later said it was checking whether the death was caused by Israeli fire.

Hezbollah has fired hundreds of rockets at Israel since it entered the regional war on March 2, prompting an Israeli offensive that has killed more than 1,000 people in Lebanon.

Israel said it had instructed the military to accelerate the demolition of Lebanese homes in “front-line villages” to end threats to Israelis, and to destroy all bridges over Lebanon’s Litani River which it said were used for “terrorist activity”.

Pope Leo appealed for an end to the conflict.

“The death and suffering caused by this war are a scandal to the whole human family,” he said.

A Reuters/Ipsos poll conducted last week found that 59 per cent of Americans disapprove of US strikes against Iran, while 37 per cent approved. The war has become a major political liability for Mr Trump ahead of November elections for Congress. REUTERS