Iran struck Britsh Castrol oil facility in the Iraqi city of Erbil with drones on Wednesday morning.
The assault took place hours after Iran’s ambassador to the UK warned that Tehran would consider strikes on British military bases.
Meanwhile the UK and the EU continued efforts to step back from the wider escalation in the Middle East.
Drones hit warehouses along the Erbil-Mosul road that store motor oil for the British company.
The site runs through a local partnership with the Sardar Group.
Fire broke out soon after the first strike at around 7.20am local time.
A second drone followed just over an hour later while crews worked to contain the blaze.
Reports say air defences stopped at least one more drone before it reached the area.
No one suffered injury. Emergency teams arrived at the scene and began to tackle the flames.
Smoke rose from the warehouses as oil and materials burned.
Castrol stated that its operations in the region focus only on investment and service provision.
The company added that it holds no connection to the conflict.
The incident comes as Iran and its allies carry out repeated attacks on sites across the Kurdistan Region.
Officials in Erbil confirmed the target and said the facility sustained damage but operations remain under review.