We consider optimal jamming strategies in wireless source localization systems, where anchor nodes estimate positions of target nodes in the presence of jammers that emit zero-mean Gaussian noise. The Cramér-Rao lower bound (CRLB) for target location estimation is derived and the problem of optimal power allocation for jammer nodes is formulated to maximize the average CRLB for target nodes under total and peak power constraints. Exploiting the special problem structure and successive convex approximation techniques, we develop an iterative algorithm that transforms the original non-convex problem into a sequence of convex geometric programs. In addition, we present a closed-form solution that is asymptotically optimal. Numerical results demonstrate the improved jamming performance of the proposed solutions over the uniform power allocation strategy.