The Showdown Between the US and Iran: Why Kharg Island Was Bombed – And What Happens Next

It's starting to feel like a whole new chapter in the conflict between the US and Iran. Late on Friday night, Swedish time, the US launched strikes on the strategically vital oil hub of Kharg Island, sitting off Iran's coast in the Persian Gulf. With smoke still hanging heavy over the area, a picture is emerging of a conflict that's rapidly accelerating – and one where no one really knows where it ends.

Kharg Island: The beating heart of Iran's oil industry

President Donald Trump confirmed the strikes himself on Truth Social, stating they had hit "all military targets" on Kharg Island. The island is absolutely central to Iran's economy – around 90 per cent of all Iranian crude oil exports pass through here. Trump was careful to point out they'd deliberately chosen not to bomb the oil infrastructure itself, at least not yet. But the threat hangs in the air: if anyone tries to disrupt shipping through the Strait of Hormuz, then "I will immediately reconsider that decision."

For those of us who've followed the Middle East conflict over the years, this is a classic power play. The US is showing it can strike at the heart of Iran's export revenue any time it likes. At the same time, it's a delicate balancing act. Iran's Supreme Leader, Ayatollah Khamenei, has been dead since earlier in March, killed in an Israeli-American attack, and the country has vowed retaliation. The question isn't whether Iran will respond, but how.

The backstory: From the Twelve-Day War to today's stalemate

This isn't an isolated event. We're at a stage that many experts, including those at home from the Swedish Defence Research Agency, have been warning about for a long time. It all properly kicked off in June 2025 with what's now being called the Twelve-Day War. Israel attacked Iran's nuclear technology program on June 13, and in the final stages, the US stepped in on Israel's side, bombing three major nuclear facilities, including Fordow, which is dug into a mountain.

Since then, it's been a low-intensity conflict with sporadic attacks. But in late February this year, the US ramped things up again. First, they took out Iran's air defence systems, then their missile and drone capabilities. And now, most recently, the strike on Kharg. It's a systematic dismantling of Iran's military muscle.

How Iran might hit back – and why it's dangerous

The short-term threat right now revolves around American soldiers and installations in the region. Iran has both the capability and the will to strike back. Consider this:

• The US has around 40,000 troops stationed across the Middle East – everywhere from Iraq and Kuwait to Qatar and Saudi Arabia. They're all potential targets.
• The Strait of Hormuz is the bottleneck through which a huge chunk of the world's oil passes. The oil price is already shaky. If Iran tries to block the strait, or attacks tankers, then we're talking about a global economic shock.
• Allied militias, like Hezbollah in Lebanon or Shia militias in Iraq, could be activated to strike US targets. Over the weekend, an attack on the US embassy in Baghdad was already reported.

At the same time, Iran is weakened. Their air defence is largely gone, and their ability to harm Israel with missiles has proven limited – most were shot down by air defences during the Twelve-Day War. This leads many analysts to expect an asymmetric response. Maybe not tomorrow, but down the track. "Once the dust settles, they'll fall back on the tactics that have served them best over the years: terrorism and asymmetric warfare," as one US expert put it the other day.

What happens now? High-stakes politics and surprising alliances

Back here in Australia, we're watching the situation closely, just like the rest of the world. It's a complex picture. Prime Minister Anthony Albanese has emphasised the need for de-escalation and protecting maritime security, a key concern for a trading nation like ours. The opposition is watching the US stance, mindful of our alliance but also wary of unintended consequences in a volatile region.

On the international stage, things are getting interesting. China, which has been Iran's key ally and biggest oil customer, has so far only offered diplomatic condemnations. No military support has appeared. Some analysts reckon this is exactly what the US is aiming for. By crippling Iran, they're showing the whole world, not least China's other allies like Cuba or Venezuela, that the powerhouse in Beijing won't come to the rescue when the chips are really down. That would allow the US to steadily shift its military focus to the Pacific and the contest with China.

The conflict with Iran is therefore about much more than just Iran. It's a piece on a much larger global chessboard. And as history teaches us, these kinds of games tend to have unintended consequences. The only question is what they'll be this time around.