Oil price jumps after US strikes Iran

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Oil prices jumped to the highest level in five months after the United States bombed the Iranian nuclear facilities, which increased the possibility of Tehran’s response by attacking energy infrastructure in the region or shipping in the hormone strait.

Brent ray, the international standard, rose to 5.7 percent of the market opening Sunday evening, but later reduced gains to about 3 percent of trading at $ 79 a barrel. The United States has risen to the intermediate margin of a similar margin to $ 76.83.

Analysts said that the additional moves in the oil price this week depend exactly on how the Islamic Republic or agents such as the Houthis for revenge.

“A clear red line has been crossed,” said Jorge Leon, head of geopolitical analysis of energy consulting at Riestad.

He said: “In an extremist scenario where Iran responds to direct strikes or targeting the infrastructure of regional oil, oil prices will increase sharply.” “Even in the absence of immediate revenge, the markets are likely to be priced at a higher geopolitical risk allowance.”

Oil prices have already rose about 14 percent since Israel launched the first sudden attack on Iran 10 days ago. High oil prices are likely to be in other energy markets, such as gasoline, which can push a new explosion of inflation around the world.

Lyon said that the entry of the United States into the war had introduced a “new layer of fluctuations in energy markets”, leaving merchants waiting for “the next step for Tehran.”

US president Donald Trump said that Iran for other attacks if Tehran did not “show” peace “, but the Islamic Republic has previously pledged revenge if the United States participated. The militants in Iran were already invoked to take action on Sunday, as the influential editor in Kayhan newspaper demanded that the country attack the US Navy in the Gulf and stop the western ships that move through the Strait of Hormuz.

Analysts said that about a third of the oil supplies transported by the sea in the world pass daily through the narrow waterway that separates Iran from the Gulf states, and any attacks on shipping in the strait will immediately lead to high energy prices.

Iran had previously threatened to close the strait, although analysts believe it would struggle to completely prevent the waterway due to the presence of the Fifth Navy in Bahrain.

“Security officials assert that it will be difficult for Iran to close the Strait of Hormuz for a long time,” said Hillima Capital Markets. “This is what is said, multiple security experts claim that Iran has the ability to hit individual tankers and the main ports with missiles and mines,” she said.

Iran also uses the waterway to charge oil to China and other importers.

An alternative response that can see Iran attacking oil and infrastructure fields in American allies in the region, such as Saudi Arabia and Qatar. Anxiety from attraction to the conflict, the Gulf states have repeatedly called the Gulf states to the extent to the hostility of hostilities and a return to dialogue.

In a statement on Sunday morning, the Ministry of Foreign Affairs in Doha warned that “dangerous tension” in the region could have “catastrophic repercussions.” The Kingdom of Saudi Arabia said it was following developments in Iran with “great concern.”

Analysts at the S& PLOBAL Commodity Insights said that the gathering in oil prices may be reduced by Monday morning if there is no immediate Iranian response.

“The main question is what comes after that,” said James Pambino and Richard Josewick from the S&P. “Will Iran attack the US interests directly or through allied militias? Will Iranian crude exports be suspended? Will Iran attack shipping in the Strait of Hormuz?”

Even if Iranian crude exports are disrupted, increasing production of Opec+ Cartel and current global stocks means that the oil market will remain enough, as long as the Hormuz Strait is still open.

Iran exports about 2 million oil barrels per day, while about 21 million barrels from Iran, Iraq, Kuwait, Saudi Arabia, Qatar and the United Arab Emirates pass daily through the Strait of Hormuz.

Analysts said the longest geopolitical tensions in the Middle East remain more than a long risk of oil prices, raising inflation and global economic growth.

“It is possible that the Trump administration will find it difficult to balance Iranian nuclear ambitions while avoiding a long rise in crude oil prices, in turn, which increases inflation and weakening the American economy,” said Michael Alvaro, chief investment employee in Gallo Partners, focusing on energy and industries.