Israel and US control Iranian airspace

What happened: Israel has established a secret military base in Iraq to support air operations against Iran, according to a report by [The New York Times](https://www.nytimes.com/2022/03/09/world/middleeast/israel-iraq-base-iran.html). Meanwhile, an Israeli Iron Dome operator was arrested for spying for Iran, highlighting Israeli intelligence inroads into the country. The tension has driven a wave of attacks on major energy infrastructure in the Gulf, with oil prices holding above $110 per barrel. Israeli Prime Minister Benjamin Netanyahu stated that Iran is being "decimated" but emphasized the need for a "ground component" for meaningful regime change.

Market impact: The escalating conflict between Israel and Iran is driving up oil prices, with [Brent crude](https://www.bloomberg.com/quote/COM:GC1) futures trading above $110 per barrel. Energy companies like [ExxonMobil](https://www.bloomberg.com/quote/XOM:US) and [Shell](https://www.bloomberg.com/quote/SHEL:LN) may benefit from higher oil prices, while consumers face increased energy costs. The potential removal of US sanctions on Iran, as hinted by US Treasury Secretary Janet Yellen, could increase global oil supply and put downward pressure on prices.

What to watch next: Investors should monitor the following catalysts: (1) the US and EU's response to Iran's nuclear program and potential easing of sanctions, which could impact global oil supply and prices; (2) any further escalation in military tensions between Israel and Iran, which could disrupt energy infrastructure and drive oil prices higher; (3) the upcoming earnings reports from energy companies like [Chevron](https://www.bloomberg.com/quote/CVX:US) and [BP](https://www.bloomberg.com/quote/BP:LN) to gauge the impact of higher oil prices on their financial performance.